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How banks make money

Net interest income, fees and trading, and the provision for credit losses, with figures from bank 10-K filings.

Net interest income

Net interest income = interest earned − interest paid

A bank takes in deposits and borrows money, then lends it out and buys bonds. The interest it earns on loans and securities, minus the interest it pays depositors and lenders, is net interest income. It rises and falls with the size of the loan book and with interest rates: when rates go up, what a bank earns on loans often reprices faster than what it pays on deposits, and the other way round when rates fall.

The related ratio is the net interest margin: net interest income divided by the assets that earn interest. Banks report it in the management discussion of their 10-K.

Noninterest income

Everything else a bank earns is noninterest income: account and card fees, investment banking and advisory fees, trading, asset and wealth management fees, and mortgage fees. For Goldman Sachs it was most of the business: $44.7B of noninterest income against $13.6B of net interest income in fiscal 2025. Morgan Stanley's mix was similar: $60.6B of noninterest income and $10.0B of net interest income.

American Express is a card network as well as a lender, so the fees merchants pay when customers use its cards are its biggest source of revenue: $54.9B of noninterest income against $17.4B of net interest income in fiscal 2025.

Source: Goldman Sachs 10-K for fiscal 2025, filed Feb 25, 2026 · Morgan Stanley 10-K for fiscal 2025, filed Feb 19, 2026 · American Express 10-K for fiscal 2025, filed Feb 6, 2026

Lenders and fee businesses

Wells Fargo is closer to a traditional lender: $47.5B of net interest income and $36.2B of noninterest income in fiscal 2025. In the table below, 6 of the 10 companies earned more from net interest income than from everything else, and 4 earned more from noninterest income.

Source: Wells Fargo 10-K for fiscal 2025, filed Feb 24, 2026

Why bank revenue is "net of interest expense"

For most companies, interest is a financing cost that sits below operating income. For a bank, interest paid on deposits is a cost of doing business, so banks report revenue after taking it out. That's why their income statements show "total net revenue" or "total revenue, net of interest expense", and why they don't report gross profit or operating income the way an industrial company does.

The provision for credit losses

Some loans won't be repaid. Each quarter a bank sets aside an estimate of the losses it expects over the life of its loans, called the provision for credit losses, and takes it out of earnings. JPMorgan Chase's provision for fiscal 2025 was $14.2B. The provision rises when the bank expects more borrowers to fall behind, as in a recession, and can fall or even turn into a release when its outlook improves.

Source: JPMorgan Chase 10-K for fiscal 2025, filed Feb 13, 2026

Net interest and noninterest income for 10 banks and financial companies

Latest fiscal year from each company's 10-K, sorted by the share of revenue that came from net interest income. Total revenue is after interest expense, as these companies report it. Companies that don't tag both parts in a way that adds up to total revenue aren't listed.

More in Learn and Tools · Methodology & Disclosures explains where every number comes from.