Even as benchmark rates rose, banks lowered their spreads, keeping mortgage loan rates flat for a second month. The overall household loans lending rate also held at the previous month's level. In contrast, deposit rates rebounded for the first time in a year.
According to the Bank of Korea's "weighted average rates of financial institutions for September" released on the 31st, deposit banks' household loans lending rate (on new loans) was 4.17% per year, unchanged from the previous month.
Among household loans, the mortgage loan lending rate was 3.96%, unchanged for a second month. Jeonse deposit loans were 3.76%, and general unsecured loans were 5.31%, down 0.02 percentage point (p) and 0.1%p, respectively. Jeonse deposit loans fell for the first time in four months, and unsecured loans fell for the first time in three months.
Kim Min-su, a Bank of Korea (BOK) financial statistics team manager, said, "The mortgage rate stayed at the previous month's level because, although benchmark rates such as 5-year bank bonds rose, some banks lowered spreads or expanded preferential rates in August–September."
Corporate loan rates were tallied at 3.99%, down 0.04%p. It was the fourth straight monthly decline. Although short-term market rates rose, loan rates for large corporations (-0.08%p) and small and midsize enterprises (-0.01%p) both fell, helped by expanded policy finance.
Including household loans and corporate loans, the overall bank lending rate was 4.03%, down 0.03%p from the previous month.
The savings-type deposits (deposits) rate at deposit banks (on new deposits) rose 0.03%p to 2.52% per year from the previous month. It increased for the first time in a year. Rates on pure savings-type deposits such as time deposits (+0.04%p) and market-type financial products such as CDs and financial bonds (+0.02%p) went up.
With lending rates down and deposit-taking rates up, the spread between lending rates and savings-type deposit-taking rates narrowed by 0.06%p to 1.51%p from the previous month.
Nonbank financial institutions saw both deposit and lending rates fall from the previous month. Mutual savings banks cut deposit and lending rates by 0.01%p and 0.20%p, respectively. Credit unions reduced them by 0.05%p and 0.19%p, respectively. Mutual finance institutions lowered them by 0.01%p and 0.10%p, respectively. The Korean Federation of Community Credit Cooperatives (KFCC) cut them by 0.04%p and 0.20%p, respectively.