Variable Mortgage Loan Rates Rise Again... New COFIX Up 0.26%p to 1.55%

Record Largest Increase

[Asia Economy Reporter Park Sun-mi] The COFIX (Cost of Funds Index), which banks use as a benchmark to calculate variable interest rates for mortgage loans, has risen by 0.26 percentage points in one month. Starting tomorrow, the mortgage loan interest rates applied by banks are also expected to increase.

According to the Korea Federation of Banks on the 15th, the COFIX based on new contracts in November was 1.55%, up 0.26 percentage points from 1.29% in the previous month. This is the largest monthly increase since the COFIX was first announced. The new COFIX has been rising for six consecutive months since May.

The outstanding balance-based COFIX also rose by 0.08 percentage points to 1.19% compared to the previous month, and the new outstanding balance-based COFIX recorded 0.94%, increasing by 0.05 percentage points.

COFIX refers to the weighted average interest rate of funds raised by eight domestic banks including NH Nonghyup, Shinhan, Woori, SC Jeil, Hana, Industrial Bank of Korea, KB Kookmin, and Korea Citibank. It moves in response to increases or decreases in the interest rates of deposit products such as actual deposits, savings, and bank bonds handled by banks. However, while the outstanding balance-based COFIX and new outstanding balance-based COFIX generally reflect market interest rate changes gradually, the new contract-based COFIX is calculated based on funds newly raised during the month, so it tends to reflect market interest rate changes more quickly.

As COFIX rises, the variable mortgage loan interest rates set by banks reflecting this are also expected to increase simultaneously from the 16th.

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