So Northern Community Bank shares the profit it makes each year but you cannot tell me what the rate will be for next year?
A question that comes up occasionally is what is the different between Northern Community Bank’s share of the profit and the bank offering an interest rate on saving accounts. In the simplest terms Community Bank is owned by the account holders, you have savings which are shares in the business, when the business is successful like Northern Community Bank has been for a number of years – you the owners share the profits.
The difference with a high street bank’s savings account is that there is an advertised rate of interest on any savings. However as pointed out by the FCA who regulate banks, building societies and Community Banks, these interest rates can be decreased as long as the customer is given notice, usually with a 2 month period; so not guaranteed unless a fixed period.
At the end of every year, after providing for reserves and paying expenses, the share of the profits is proposed at the AGM. The profits go back to our account holders.
This ensures that any profit that is made by Northern Community Bank stays within our community and does not go to faceless external shareholders. So it does not matter whether you have £5.00 or £5,000.00 with Northern Community Bank or how often you use your account you will get the same share of the profit as everyone else.
How do we compare
You can find out the rate Northern Community Bank has paid when sharing the profits in recent years on this page.
