'0% Range Deposit Era' Commercial Banks Begin Full-Scale Deposit Interest Rate Cuts

[Asia Economy Reporter Kangwook Cho] Following the Bank of Korea's base interest rate cut, domestic commercial banks have begun to lower their deposit and savings interest rates in earnest. Recently, KB Kookmin Bank, SC First Bank, and Citibank reduced their deposit rates, followed by Shinhan Bank and NH Nonghyup Bank. Woori Bank has also decided to cut rates, and Hana Bank is expected to lower deposit and savings rates by next week at the latest.

According to the financial sector on the 13th, Nonghyup Bank lowered interest rates on deposit products by 0.15 to 0.40 percentage points on the 12th. The basic interest rate for fixed-term deposits was reduced by 0.15 to 0.25 percentage points. The interest rate for standard products such as general time deposits and flexible installment time deposits for terms between one and two years dropped from 0.7% per annum to 0.45%, a decrease of 0.25 percentage points.

Shinhan Bank also cut interest rates on deposit and savings products uniformly on the same day, by a minimum of 0.05% and up to 0.5 percentage points. The representative time deposit products, ‘Shinhan S Dream Time Deposit’ and ‘Solpyeonhan Time Deposit,’ saw their base interest rates fall by 0.3 percentage points. The one-year maturity deposit interest rate dropped from 0.9% to 0.6% per annum.

Woori Bank announced that it would reduce interest rates on deposit products by as little as 0.05 percentage points and as much as 1 percentage point on the same day. The revised rates will apply from the 17th for fixed and installment deposits, and from the 20th for demand deposits. Hana Bank is also conducting internal reviews to lower deposit and savings interest rates as soon as possible.

Earlier, on the 2nd, KB Kookmin Bank began by lowering the base interest rate on its flagship product, the ‘Kookmin Super Time Deposit,’ by 0.3 percentage points and decided to adjust the base rates on about 50 deposit products overall. Foreign banks SC First Bank and Citibank lowered deposit and savings interest rates by up to 0.3 percentage points starting from the 8th.

As commercial banks consecutively reduce deposit interest rates, loan interest rates are also expected to decrease next week.

This content was produced with the assistance of AI translation services.