Credit: Shutterstock photoE-Trade earns a significant portion of its net revenues through net interest income, the difference between the interest it earns on its interest earning assets and the interest it pays on its interest earning liabilities.
Between 2013 to 2015, E-Trade's revenue from its interest earning assets stagnated at around $1.2 billion, while the interest paid on liabilities decreased by as much as 46%. The decrease was mainly due to the termination of company's legacy wholesale funding obligations in 2015. Consequently, the brokerage's net interest income rose 12% over the period to $1.09 billion.
On the other hand, the company's net interest revenue as a percentage of total revenue increased from 56% in 2013 to 76% in 2015, as the growth in net interest income outpaced E-Trade's total revenue growth.
Have more questions about E-Trade Financial? See the links below:
- What's E-Trade's Revenue And EBITDA Breakdown In Terms Of Different Operating Segments?
- How Has E-Trade's Revenue Composition Changed Over The Past 5 Years?
- By How Much Has E-Trade's Revenue & EBITDA Grown In The Last Five Years?
- What Is E-Trade's Fundamental Value Based On Expected 2016 Results?
- How did E-Trade's EBITDA Decline Outpace Revenue Decline In 2015?
- How Is E-Trade Expected To Grow In The Next Five Years?
- How much will E-Trade's Revenues Grow If Fed Hikes Rates To 4% By 2018?
- How Did E-Trade's Segment Revenues Change Over The Last Five Years?
- How much will E-Trade's Revenues Grow If Trade Volumes Increase By 25% In 2018?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for E-Trade
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
