Editing Openai/69189184-ed58-8011-9515-d71168b70e9c (section)

=== Assistant: Yes — there are credible central-bank and central bank-authoritative sources that clearly state that when a bank loan i… ===
Yes — there are credible central-bank (and central bank-authoritative) sources that clearly state that when a bank loan is repaid the money created by that loan is removed (i.e., “destroyed”/“extinguished”) rather than remaining as a kept asset for the bank. Below are key excerpts plus commentary.

==== 1. From Bank of England, “Money creation in the modern economy” (2014) — Q1 Quarterly Bulletin: > ====
# From the Banque de France Bulletin “Central bank asset purchase programmes: how is money created and then destroyed?” (2023): >
# From a Bank for International Settlements (BIS) talk by Thomas Jordan (Swiss National Bank) — “How money is created by the central bank …” (2018) — which describes lending/deposit creation: >

==== Your question: “Do you have source material from the central bank that confirms they don’t keep the principal?” ====
* The Bank of England’s statement indicates that the deposit created by the loan is removed when the loan is repaid (“destroys money”). That implies the bank does not simply keep the principal as a deposit on its balance sheet where it remains available to lend out again (in the sense of “kept principal”).
* In other words: the principal you repay reduces the liability (deposit) of the banking system, rather than being retained as extra surplus for the bank.

Thus: yes — the official description shows that the system does not treat your principal repayment as “bank now keeps that money and keeps it in circulation as a deposit,” but rather that the deposit is removed.

==== - These documents do not typically say “the bank keeps zero of the principal payment” in the sense “the bank receives zero amount.” The bank does receive payment from you (you transfer funds), but in accounting terms that payment reduces both the bank’s asset (your loan) and the bank deposit liability (yours or some other entity’s). The net effect: money is extinguished from the deposit side. ====
* These sources mostly describe the banking‐system as a whole rather than individual bank profit/loss or how banks handle each repayment dollar in internal accounting. They do not say “this bank uses your principal payment to make a profit” (rather they imply the profit for banks comes via interest, not principal).
* Central bank/official documents tend to describe broad aggregates (loans → deposits → repayments destroy). They may not always walk through every ledger line at each individual bank in detail, but the principle is clearly stated.

If you like, I can pull and highlight more quotes from various central banks (Fed, ECB, Bank of Japan, etc.) to give you a broader set of official-documents stating this mechanism. Would you like me to do that?