Home Mortgage Variable Rates Set to Rise Again as COFIX Jumps 0.25 Percentage Points in a Month
Korea Federation of Banks Announces September COFIX
Largest Increase in 3 Years and 10 Months
The COFIX (Cost of Funds Index), which serves as the benchmark for variable rates on banks' home mortgage loans, rose by the largest amount in 3 years and 10 months.
According to the Korea Federation of Banks on October 15, the COFIX for new transactions stood at an annual rate of 3.43% in September, up 0.25 percentage points from 3.18% in August. This was the largest increase in 46 months, since a 0.36-percentage-point rise in November 2022.
The outstanding-balance-based COFIX also rose by 0.10 percentage points, from an annual rate of 3.05% in August to 3.15% in September.
COFIX represents the weighted average interest rate on funds raised by eight domestic banks: NH NongHyup Bank, Shinhan Bank, Woori Bank, SC First Bank, Hana Bank, Industrial Bank of Korea, KB Kookmin Bank, and Citibank Korea. It rises or falls to reflect changes in the interest rates on deposit products, such as savings and installment savings accounts, and bank bonds handled by banks.
The COFIX for new transactions and the outstanding-balance-based COFIX include time deposits, installment savings, mutual installment savings, housing installment savings, certificates of deposit, repurchase agreement sales, bills sold, and financial bonds (excluding subordinated bonds and convertible bonds).
Over the same period, the new outstanding-balance-based COFIX rose by 0.08 percentage points, from an annual rate of 2.71% to 2.79%. The new outstanding-balance-based COFIX also includes other deposits, other borrowings, and settlement funds.
Hot Picks Today
"Samsung Electronics at 70,000 won, SK hynix at 200,000 won"... Why the gloomy outlook despite 'record-breaking earnings'?
- "I Was Just Going Barefoot at Home"... "Absolutely Not": Why Doctors Warn Against It
- "There's a Drink Like This?"... Chinese Beverage With "Korean" in Its Name Rakes in 85 Million Won in Monthly Sales
- "To Make His Girlfriend Think It Was His": Why He Demolished Someone Else's 2-Billion-Won Apartment
- "No Need to Hire a Model"... The 25-Year-Old Woman Who Entered Social Media with a Face That Cost Just 1,500 Won [AI Content: The Bright and Dark Sides] 1
As early as October 16, commercial banks are expected to reflect the COFIX rates released today in their variable rates for new home mortgage loans.
© The Asia Business Daily. All rights reserved. Unauthorized AI training and use prohibited.
