A commercial bank's 'spread' is the difference between the interest it

1. Banks pay interest to attract deposits. 2. Banks charge a higher rate on the loans they make. 3. The gap between the two is the **spread**, and it is the bank's profit. 4. The comparison is between borrowers and depositors, not between a bank and the regulator. _Source: syllabus Introductory Macroeconomics, Ch 3 "Money and Banking", section 3.2 DEMAND FOR MONEY AND SUPPLY OF MONEY_