Reserve Bank of Australia Annual Report – 2009 Financial Statements Note 2

Note 2 NET PROFITS

Note 2009
$M		 2008
$M
Interest revenue          
Overseas investments 1(b), 4   1,266   2,042
Australian dollar securities 1(b), 4   3,093   3,092
Overnight settlements 4   37   61
Gold loans 1(c), 4   4   8
Loans, advances and other 4   1   1
    4,401   5,204
Net gains/(losses) on securities and foreign exchange          
Overseas investments 1(b)   1,469   506
Australian dollar securities 1(b)   142   (34)
Foreign currency 1(b)   5,029   (1,137)
    6,640   (665)
Dividend revenue          
Earnings on shares in Bank for International Settlements 1(b)   5   4
Fees and commissions          
Banking services fees received     21   18
Other revenue          
Reimbursement by Australian Government for
loan management and registry expenses		     1   –
Rental of Bank premises     9   8
Sales of note and security products     34   41
Superannuation revenue 1(h), 14   –   8
Other     26   25
    70   82
Total     11,137   4,643
Less:          
Interest expense          
Deposit liabilities 1(b), 4   1,744   2,342
Currency note holdings of banks 1(b), 4   167   199
Repurchase agreements 1(b), 4   129   399
    2,040   2,940
General administrative expenses          
Staff costs     149   141
Superannuation costs 1(h), 14   4   –
Special redundancy/retirement payments     3   –
Depreciation of property 1(d), 8   9   9
Depreciation of plant and equipment 1(d), 8   14   13
Premises and equipment 1(d)   37   34
Materials used in note and security products     20   21
Travel     4   3
Consultants' fees, legal fees and payments to contractors     2   2
Other     8   8
    250   231
Other expenses          
Agency business reimbursement     3   2
Subsidiary income tax     3   3
Cash distribution expenses     4   5
Other     31   32
    41   42
Total     2,331   3,213
Net Profit     8,806   1,430

Staff costs in 2008/09 include an expense of $9.0 million associated with the increase in the balance of the provision for post-employment benefits (in 2007/08 there was an expense of $12.8 million) (refer Note 10). Post-employment health care costs of $9.6 million are included in Staff Costs ($13.5 million in 2007/08).

The RBA's aggregate research and development expenditure recognised as an expense in 2008/09 was $0.5 million ($0.6 million in 2007/08); this is included in Other Expenses.