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Interest Income and Interest Expense
 6 Months Ended
Nov. 30, 2021
Banking and Thrift, Interest [Abstract]  
Interest Income and Interest Expense
NOTE 2—INTEREST INCOME AND INTEREST EXPENSE

The following table displays the components of interest income, by interest-earning asset type, and interest expense, by debt product type, presented on our consolidated statements of operations for the three and six months ended November 30, 2021 and 2020.

Table 2.1: Interest Income and Interest Expense
Three Months Ended November 30,Six Months Ended November 30,
(Dollars in thousands)2021202020212020
Interest income:
Loans(1)(2)
$279,368 $272,642 $558,187 $548,340 
Investment securities3,784 3,857 8,233 7,743 
Total interest income283,152 276,499 566,420 556,083 
Interest expense:(3)(4)
Short-term borrowings3,076 3,403 6,469 7,744 
Long-term debt144,096 144,579 288,969 293,492 
Subordinated debt26,424 26,440 52,935 53,162 
Total interest expense173,596 174,422 348,373 354,398 
Net interest income$109,556 $102,077 $218,047 $201,685 
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(1)Includes loan conversion fees, which are generally deferred and recognized in interest income over the period to maturity using the effective interest method.
(2)Includes late payment fees, commitment fees and net amortization of deferred loan fees and loan origination costs.
(3) Includes amortization of debt discounts and debt issuance costs, which are generally deferred and recognized as interest expense over the period to maturity using the effective interest method. Issuance costs related to dealer commercial paper, however, are recognized in interest expense immediately as incurred.
(4) Includes fees related to funding arrangements, such as up-front fees paid to banks participating in our committed bank revolving line of credit agreements. Based on the nature of the fees, the amount is either recognized immediately as incurred or deferred and recognized in interest expense ratably over the term of the arrangement.  

Deferred income reported on our consolidated balance sheets of $47 million and $51 million as of November 30, 2021 and May 31, 2021, respectively, consists primarily of deferred loan conversion fees of $41 million and $45 million as of each respective date.