The Importance of Risk for measurement of profitability of products and customers – inspiration from banking industry

This article treats the possibilities of including of risk into appraisal of complex gain of customers and the way which the banks use. It shows the calculation of expected loss and economic capital. It points out their usage in the financial management of the bank and the ways of preliminary and quasi-final profitability measurement using RAROC ratio. In the last section there is the case-study that shows its calculation and the impact of real changes of important parameters as rating or utilization of the facility.