Bank A has interest revenues of $4 million, interest expenses of $5 million, and assets totaling $20 million. Bank A's net interest margin is

Name: Bank A has interest revenues of $4 million, interest expenses of $5 million, and assets totaling $20 million. Bank A's net interest margin is
Brand: Quizplus
Rating: 4.9 (57 reviews)

Question

Quizplus · Accepted Answer

Net interest margin is calculated as (Interest Revenues - Interest Expenses) / Total Assets. Here, it is ($4 million - $5 million) / $20 million = -$1 million / $20 million = -0.05 or -5 percent.

Bank a Has Interest Revenues of $4 Million, Interest Expenses