The cost of funds is typically calculated as an average rate paid on all sources of funding, including deposits, borrowings from other financial institutions, and capital market instruments. This weighted average cost reflects the blended cost of all funding sources used by the institution. This concept is pivotal in determining various financial decisions, from setting interest rates on loans to managing investment portfolios. Here’s a detailed exploration of what the define cost of funds entails and its significance in different financial contexts. To get more info visit here #definecostoffunds