Reserve Bank of Australia Annual Report – 2010 Financial Statements Note 2 – Net Profits

Note 2010 $M 2009 $M
Interest revenue
Overseas investments 1(b), 4   452   1,266
Australian dollar securities 1(b), 4   1,515   3,093
Overnight settlements 4   26   37
Gold loans 1(c), 4   –   4
Loans, advances and other 4   1   1
    1,994   4,401
Net gains on securities and foreign exchange
Overseas investments 1(b)   –   1,469
Australian dollar securities 1(b)   –   142
Foreign currency 1(b)   –   5,029
    –   6,640
Dividend revenue
Earnings on shares in Bank for International Settlements 1(b)   11   5
Fees and commissions
Banking services fees received     20   21
Other revenue
Reimbursement by Australian Government for loan management and registry expenses     1   1
Rental of Bank premises     9   9
Sales of note and security products     35   34
Other     24   26
    69   70
Total     2,094   11,137
Less:          
Interest expense
Deposit liabilities 1(b), 4   801   1,744
Currency note holdings of banks 1(b), 4   104   167
Repurchase agreements 1(b), 4   13   129
    918   2,040
Net losses on securities and foreign exchange
Overseas investments 1(b)   (416)   –
Australian dollar securities 1(b)   (75)   –
Foreign currency 1(b)   4,273   –
    3,782   –
General administrative expenses
Staff costs     148   149
Superannuation costs 1(h), 14   33   4
Special redundancy/retirement payments     2   3
Depreciation of property 1(d), 8   9   9
Depreciation of plant and equipment 1(d), 8   17   14
Premises and equipment 1(d)   37   37
Materials used in note and security products     23   20
Travel     3   4
Consultants' fees, legal fees and payments to contractors     2   2
Other     8   8
    282   250
Other expenses
Agency business reimbursement     3   3
Subsidiary income tax     2   3
Cash distribution expenses     6   4
Other     29   31
    40   41
Total     5,022   2,331
Net Profit     (2,928)   8,806

Staff costs in 2009/10 include an expense of $10.5 million associated with the increase in the balance of the provision for post-employment benefits (in 2008/09 there was an expense of $9.0 million) (refer Note 10). Post-employment health care costs of $10.3 million are included in Staff costs ($9.6 million in 2008/09).

The RBA's aggregate research and development expenditure recognised as an expense in 2009/10 was $0.7 million ($0.5 million in 2008/09); this is included in Other expenses.