The profit from transactional banking services for the Reserve Bank of Australia is in a slow but steady decline. In the RBA annual report yesterday the bank said profit from this business - which it described as contestable but which largely isn't - fell seven per cent to $2.7 million in the year to June 2007.The net profit of this business was $3.2 million in 2003.The RBA provides transaction banking services to the Commonwealth government and to dozens of government agencies. Most state governments transferred their banking business to private sector banks some years ago.The Reserve Bank said it opted not to renew the bulk of gold loans that matured during the 2007 year given "very low returns" of four basis points on loans of up to one year and returns of 35 basis points of loans of up to five years. The amount of gold on loan thus fell from 53 tonnes in 2006 to 42 tonnes in 2007, about half the bank's holdings.