Finance

Base rate raised twice, but loan rates move differently by product

The Bank of Korea has raised its policy rate twice in a row, but loan rates are moving at different speeds depending on the product. Variable-rate mortgages are typically linked to COFIX, while fixed and mixed-rate mortgages follow market rates such as bank debentures. Existing variable-rate borrowers also see changes only when their repricing cycle arrives. COFIX has risen for four straight months, while longer-term market rates can move earlier on policy expectations.

Finance

July bank household loan rate at 4.64%; mortgage rate rises to 4.48%

South Korean banks\' household loan interest rate rose to 4.64 percent in July, up 0.14 percentage points from the previous month, while mortgage rates increased to 4.48 percent, the central bank said. Corporate loan rates fell to 4.20 percent, helping push the overall bank lending rate for new loans down 0.04 points to 4.27 percent. Savings deposit rates rose to 3.21 percent, narrowing the spread.