Search: Net interest margin

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1–8 of 8 collapsed search results for Net interest margin

RBA Glossary definition for Net interest margin

Net interest margin – A measure of the difference between a bank�s interest earnings and interest expenses, expressed as a proportion of their interest-earning assets.

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The Impact of Interest Rates on Bank Profitability: A Retrospective Assessment Using New Cross-country Bank-level Data

21 Jun 2023 RDP 2023-05
Callan Windsor, Terhi Jokipii and Matthieu Bussiere
Our analysis confirms the empirical regularity that declining interest rates reduce banks’ net interest margins. ... Importantly, the effect of lower interest rates on net interest margins is larger than the effect on asset returns, suggesting that
https://www.rba.gov.au/publications/rdp/2023/2023-05.html

The Impact of Interest Rates on Bank Profitability: A Retrospective Assessment Using New Cross-country Bank-level Data

21 Jun 2023 RDP 2023-05
Callan Windsor, Terhi Jokipii and Matthieu Bussiere
demand. All else equal, lower interest rates are likely to directly impact bank profitability by eroding banks' net interest margins (NIMs). ... AUS. CAN. CHL. CZE. DEU. FRA. NOR. POL. SWE. CHE. Net interest margin (NIM).
https://www.rba.gov.au/publications/rdp/2023/2023-05/full.html

References

21 Jun 2023 RDP 2023-05
Callan Windsor, Terhi Jokipii and Matthieu Bussiere
Busch R and C Memmel (2015), ‘Banks' Net Interest Margin and the Level of Interest Rates’, Deutsche Bundesbank Discussion Paper No 16/2015. ... Claessens S, N Coleman and M Donnelly (2018), ‘“Low-for-Long” Interest Rates and Banks' Interest
https://www.rba.gov.au/publications/rdp/2023/2023-05/references.html

Appendix A: Summary of Selected Bank-level Papers

21 Jun 2023 RDP 2023-05
Callan Windsor, Terhi Jokipii and Matthieu Bussiere
Lower rates have a negative impact on net interest margins, which is offset by a positive impact on loan-loss provisions. ... Federal Deposit Insurance Corporation. Panel GMM estimation. Lower interest rates compress net interest margins, but lower
https://www.rba.gov.au/publications/rdp/2023/2023-05/appendix-a.html

Data Description

21 Jun 2023 RDP 2023-05
Callan Windsor, Terhi Jokipii and Matthieu Bussiere
The ratio of net income expressed as a percentage of average total assets (ATA). ... Net interest margin (NIM). The ratio of net interest income (NII) expressed as a percentage of average interest earning assets (AEA).
https://www.rba.gov.au/publications/rdp/2023/2023-05/data-description.html

Empirical Findings across Countries

21 Jun 2023 RDP 2023-05
Callan Windsor, Terhi Jokipii and Matthieu Bussiere
AUS. CAN. CHL. CZE. DEU. FRA. NOR. POL. SWE. CHE. Net interest margin (NIM). ... FRA. SWE. CHE. Net interest margin (NIM). r. 0.018. 0.036. 0.331.
https://www.rba.gov.au/publications/rdp/2023/2023-05/empirical-findings-across-countries.html

Introduction

21 Jun 2023 RDP 2023-05
Callan Windsor, Terhi Jokipii and Matthieu Bussiere
demand. All else equal, lower interest rates are likely to directly impact bank profitability by eroding banks' net interest margins (NIMs). ... See, for example, Mario Draghi's quote from 27 March 2019: ‘We will continue monitoring how banks can
https://www.rba.gov.au/publications/rdp/2023/2023-05/introduction.html

Non-technical summary for ‘The Impact of Interest Rates on Bank Profitability: A Retrospective Assessment Using New Cross-country…

21 Jun 2023 RDP 2023-05
Callan Windsor, Terhi Jokipii and Matthieu Bussiere
A key takeaway from our investigation is that the effect of a decline in interest rates on banks' net interest margins – a component of overall profitability – is small, economically speaking. ... More importantly, perhaps, the effect of lower
https://www.rba.gov.au/publications/rdp/2023/2023-05/non-technical-summary.html