Net Interest Income [Economy: Banking Sector]

Context: ICICI Bank on Saturday said standalone net profit for the quarter ended September 30 climbed 37% to ₹7,558 crore from a year earlier, driven by 26% growth in net interest income (NII) to ₹14,787 crore and a dip in provisioning.

About Net Interest Income

◼ Net interest income reflects the difference between the revenue generated from a bank's interest-bearing assets and the expenses associated with paying its interest-bearing liabilities.

◼ The type of assets earning interest for the bank can range from mortgages to auto, personal, and commercial real estate loans.

◼ The amount of net interest income a bank generates will depend on many factors including the quality of the loan portfolio, the collective interest rates each type of loan carries, as well as whether the loans carry a fixed or variable rate.

◼ Banks calculate their net interest income by subtracting the interest they must pay out to their clients from the interest income they generate.

◼ You can find a bank's net interest income in its quarterly and annual reports.