Reserve Bank of Australia Annual Report – 2018 Financial Statements Note 4 – Interest Income and Interest Expense

Analysis for the year ended 30 June 2018

  Average balance
$M		 Interest
$M		 Average annual
interest rate
Per cent
Interest income
Foreign currency investments 74,878 345 0.5
Australian dollar investments 91,865 1,744 1.9
Overnight settlements 494 6 1.3
Cash collateral provided 283 4 1.5
Gold loans 399 1 0.2
Loans, advances and other 42 1 1.4
  167,961 2,101 1.3
Interest expense
Exchange Settlement balances 27,529 408 1.5
Deposits from governments 40,700 699 1.7
Deposits from overseas institutions 2,478 30 1.2
Banknote holdings of banks 3,284 41 1.2
Foreign currency repurchase agreements 1,627 16 1.0
Australian dollar repurchase agreements 61 1 1.4
Cash collateral received 321 5 1.5
Other deposits 4 – 0.2
  76,004 1,200 1.6
Net interest income 91,957 901 1.0
Analysis for the year ended 30 June 2017
Interest income 160,245 2,109 1.3
Interest expense 70,254 1,086 1.5
Net interest income 89,991 1,023 1.1

Interest income for 2017/18 includes $1,501 million calculated using the effective interest method for financial assets not at fair value through profit or loss ($1,376 million in 2016/17). Interest expense for 2017/18 includes $1,200 million calculated using the effective interest method for financial liabilities not at fair value through profit or loss ($1,086 million in 2016/17).