Net interest income for banks - the number one driver of industry profits - is deep into a period of unusual vigour.The major banks' implied spread, being the difference between average lending rates and debt funding costs, increased by around 20 basis points over 2015, according to a review of industry funding costs in latest Reserve Bank Bulletin."This change was driven in roughly equal parts by the decline in average funding costs relative to the cash rate, and an increase in the average lending rate," the RBA said."However, lending rates and debt funding costs tend to move in line with each other in the longer run," the authors note."The contribution to the aggregate implied spread from higher lending rates was entirely due to increases in housing lending rates, with the implied spread on housing lending now higher than the previous peak in 2009," the RBA conclude.Implied spreads on business lending, however, declined over 2015, the RBA said."Consistent with strong competition, implied spreads on large business lending have returned to pre-global financial crisis levels, when there was strong competition, business conditions were highly favourable and risk premia were compressed. "Much of the competition is coming from foreign banks, with the average rate on business loans written by foreign banks significantly lower than the rate being charged by Australian banks."