The latest quarterly report from the Federal Deposit Insurance Corporation (FDIC) reveals that the country's banks suffered a record year-over-year drop of 7.2% in net interest income. Accompanying that, their net interest margin also landed at 2.68%, an all-time collective low for as long as the FDIC has been tracking the metric.

Many banks are posting relatively significant declines in these figures. Bank of America (NYSE:BAC) saw a more than 8% decline in its third quarter net interest income, to just over $10.1 billion.

Cash being passed through a bank teller window.

Image source: Getty Images.

Net interest income and margin are crucial line items for banks, as both essentially measure the difference between the costs of their funding, and the take from loans. Since loans have always been, and likely always will be, the foundation of a bank's business, investors in such stocks closely follow both net interest income and margin.

As with so many other parts of the economy, banking is struggling to cope with the effects of the coronavirus pandemic. One big problem lenders have to surmount is interest rates, which are minuscule and almost certain to remain so because of the financial uncertainty engendered by the outbreak.

Despite that, the FDIC is optimistic on the proximate future of the industry in its report. Despite the current challenges, "the banking industry remains well capitalized with ample liquidity and has, to date, weathered the economic effects of the pandemic," American Banker quoted FDIC chair Jelena McWilliams as saying.

Bank of America, for one, is echoing that bullishness. In a conference call discussing its third-quarter results, CFO Paul Donofrio said that the quarter should represent a bottom for its net interest income. He believes that Bank of America will especially benefit from a pickup in commercial-loan utilization rates from economic recovery once the pandemic eases.

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