Gross Yield on Earning Assets Calculator

Written by:
PK

On this page is a bank gross yield on earning assets calculator. Enter the bank's interest or investment income, and the current and last period earning assets to estimate the gross yield on earning assets.

Gross Yield on Earning Assets Calculator

What is the gross yield on earning assets?

The gross yield on earning assets is a bank performance metric which estimates the yield that a bank is earning in interest on its investments. By comparing interest and investment earnings to earning assets, you can estimate the gross yield. Netting out interest and investment expenses shows the closely related net interest margin.

The gross yield on earning assets can only be compared relatively – either to the bank itself in similar prevailing regimes, or to the bank's peers. A higher number is generally better, but note that a higher yield likely means a bank is taking on some sort of risk, or higher duration.

Gross Yield on Earning Assets Formula

The gross yield on earning assets formula is:

gross\ yield\ on\ earning\ assets=\frac{interest\ income}{average\ earning\ assets}

Where:

  • Interest Income – Interest and investment income earned by the bank.
  • Earning Assets – The average of the current and previous period's earning assets. (Make sure you match the period with the income and expenses)

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PK

PK started DQYDJ in 2009 to research and discuss finance and investing and help answer financial questions. He's expanded DQYDJ to build visualizations, calculators, and interactive tools.

PK is in his mid-30s and works and lives in the Bay Area with his wife, two kids, and dog.

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