Net interest margin, in finance, is a measurement of the difference between interest received and interest paid that has been multiplied by the entire amount of interest-producing assets owned by the bank.
In summary, net interest margin is one measure of a bank's success and expansion. It displays how much interest the bank is making on loans compared to how much interest it is paying out on deposits.
Consider a scenario where a bank produced $100 million worth of loans in a single year, resulting in $5.5 million in interest income. The bank gave its depositors $2.5 million in interest that same year.
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