The loan business of commercial banks is its main source of profit. Commercial banks earn income by issuing loans to customers and charging a certain spread. Banks get low-cost funds from depositors and then use these funds to issue loans. Therefore, when the loan interest rate is higher than the deposit interest rate, banks can obtain funds at a lower cost and lend them to borrowers at a higher interest rate, thus obtaining a larger profit difference. Of course, in addition to loan business, commercial banks can also obtain income through other financial activities such as investment and agency business.

Commercial banks need reasonable risk management and effective internal control to ensure their profitability. In addition, the profitability of banks is also related to macroeconomic environment, monetary policy and market competition.