## figure2-4

## Source details

**Canonical URL:** [figure2-4](https://www.imf.org/-/media/files/publications/gfsr/2017/april/figure2-4.pdf)

## Other formats

- [Markdown version](/-/media/files/publications/gfsr/2017/april/figure2-4.pdf.md)
- [Structured JSON version](/-/media/files/publications/gfsr/2017/april/figure2-4.pdf.json)

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### Normal Steady State
- Asset returns and funding costs normally adjust proportionally as interest rates fall.
- Axis ticks shown: 0.0, 0.5, 1.0, 1.5, 2.0, 2.5, 3.0, 3.5 (Five-year rate).
- Two series labeled: Asset returns; Funding costs.

### Low-for-Long Steady State
- Asset returns fall significantly more once funding costs hit the zero lower bound.
- Vertical axis segment shown from –0.5 to 2.5 (Five-year rate) with series: Asset returns; Funding costs.

### Net Interest Margins
- Net interest margins compress in periods of prolonged low interest rates.
- NIM annotations shown: 
  - NIM (five-year rate drop: 2 to 1 percent)
  - NIM (five-year rate drop: 1 to 0 percent)
- NIM axis ticks shown: 1.0, 1.2, 1.4, 1.6, 1.8, 2.0

### Figure caption and notes
- Figure 2.4. Japan: Evolution of Bank Net Interest Margins in Normal and Low-for-Long Settings (Percent)
- Sources: Fitch Connect; and IMF staff calculations.
- Note: NIM = net interest margin.

*Source: figure2-4*

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_Source: https://www.imf.org/-/media/files/publications/gfsr/2017/april/figure2-4.pdf_