The goal of this paper is to demonstrate the extent to which the quality of the leader-follower relationship, expressed by the LMX coefficient, affects the bank profitability. Banks characterised by a high level of LMX possess a successful social atmosphere and interpersonal relationships, which is reflected in the emotional support and willingness to share resources, knowledge, and information between employees. Such a relationship between leaders and followers contributes to creating favourable social atmosphere, significantly affecting the overall performance of banks. Empirical research presented in this paper uses the data collected from a business network of a specifically selected Bank. The data was collected via a modified version of the LMX-7 questionnaire, focusing on each branch of a selected bank. Concrete indicators were analyzed (such as net profit margin, ROA, and ROE), which helped establish a link between profitability and the degree of leader-follower communication exchange (measured by LMX coefficient). The results reveal that the applied leadership style directly impacted on the profitability of a selected bank, indicating that this finding could be used as input for management systems of similar financial institutions as well as a catalyst for further research in this field. Keywords: banks, leadership, leader-member exchange (LMX), in-group exchange, out-group exchange Cilj ovog rada je ukazati na razinu, u kojoj kvaliteta odnosa izmedu voda i sljedbenika, izraenih koeficijentom LMX, utjece na profitabilnost banke. Banke, koje odlikuje visoka razina koeficijenta LMX, imaju uspjenu organizacijsku klimu i meduljudske odnose, to se iskazuje kroz emocionalnu podrku te spremnost za podjelu resursa, znanja i informacija medu zaposlenicima. Ovakav odnos izmedu voda i sljedbenika doprinosi stvaranju povoljne organizacijske klime, koja znacajno utjece na poslovne rezultate banke. Empirijsko istraivanje u ovom radu koristi modificiranu inacicu upitnika LMX-7, usredotucujuci se na poslovnice izabrane banke. Analiziraju se konkretni pokazatelji (kao to su neto profitna mara, ROA i ROE), kako bi se utvrdila povezanost izmedu profitabilnost i razine razmjene komunikacija izmedu voda i sljedbenika (a to se mjeri koeficijentom LMX). Rezultati ukazuju da primijenjeni stil vodenja izravno utjece na profitabilnost promatrane banke, a to indicira da bi se dobiveni rezultati mogli primijeniti u menaderskim sustavima slicnih financijskih institucija, kao i poticaj za daljnja istraivanja. Kljucne rijeci: banke, vodenje, razmjena izmedu voda i sljedbenika, unutargrupna razmjena (komunikacija), medugrupna razmjena (komunikacija), 1. INTRODUCTION 'Good leadership makes it easy for followers to follow and good 'followership' makes it easy for leaders to lead' Richard B. Gasaway, 2006 The leadership phenomenon is as [...]