Metrics & KPIsNet interest margin
Definition
This KPI is measured using the following formula: (Interest Income - Interest Expense) / Average Earning Assets. Average earning assets includes all investments, securities, funds sold, etc., and all loans. In simple terms, net interest margin measures the difference between what is paid for deposits and borrowings and what is earned on loans and investments. It is sometimes referred to as the profit margin on money.
Tags
loan, deposit, expense, profit, investment, interest, earning, income, asset