Net interest cost


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Net interest cost (NIC)

The total amount of interest that will be paid on a debt obligation by a corporate or municipal bond issuer.

Net Interest Cost

The cost of capital for a bond issuer; that is, a calculation of how much an issuer will spend in interest on one of its bonds. The way the net interest cost is calculated involves the average interest rate weighted for the time to maturity. One increases or decreases the net interest cost according to various discounts or premiums that the issuer allows or is paid. Critics contend that calculating the net interest cost is less accurate than the total interest cost.
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References in periodicals archive ?
As noted earlier, most municipal bond studies operationalize interest costs using NIC, the net interest cost. Accordingly, NIC is used in all models.
After including a 12.9% decrease in net interest costs to $6.85 million, pretax income for the year edged down 1.6% to $116.4 million.
Net interest costs, meanwhile, plummeted 49.4% to $7.34 million.
Net interest costs, meanwhile, rose 10.8% to $82 million in the fourth quarter and edged up 2.5% to $287 million over the year.
On a positive note, net interest costs fell 18% to $22.1 million, behind lower interest expenses and higher interest income.
With net interest costs escalating 34.2% to $79.3 million, pretax profits grew 15.5% to $1.24 billion.
Pretax income advanced 7.5% to $9 million after factoring in a 3.1% reduction in net interest costs to $3.46 million.
Meanwhile, net interest costs were down 0.5% to $205 million for the longer span.
In addition to deteriorating operating results, the 39-week bottom line was pressured by a 17.3% increase in net interest costs to $360 million.
Longs' results were also hindered by an eight-fold escalation in net interest costs to $4.1 million.