August New CoFIX 2.96%... 0.06% Increase from Previous Month

Continuing the Upward Trend Compared to the Previous Month

[Image source=Yonhap News]

[Asia Economy Reporter Yu Je-hoon] In May, the COFIX (Cost of Funds Index) based on new transaction amounts showed a slight increase, reaching 2.96%.

According to the Korea Federation of Banks on the 15th, the COFIX based on new transaction amounts last month rose by 0.06 percentage points (p) from the previous month to 2.96%. The COFIX based on outstanding balances increased by 0.20 p to 2.25%, and the COFIX based on new outstanding balances rose by 0.17 p to 1.79%.

Accordingly, commercial banks will reflect the COFIX rate level announced for last month in the variable interest rates of new mortgage loans starting from the 16th.

COFIX is the weighted average interest rate of funds raised by eight domestic banks (KB Kookmin, Shinhan, Hana, Woori, Nonghyup, Industrial Bank of Korea, SC First, and Korea Citibank). It fluctuates up or down reflecting changes in interest rates of deposit products such as actual deposits, savings, and bank bonds handled by banks.

While the COFIX based on outstanding balances and new outstanding balances generally reflects market interest rate changes gradually, the COFIX based on new transaction amounts is calculated based on funds newly raised in the current month, so market interest rate changes are reflected relatively quickly.

Meanwhile, the short-term COFIX announced over the past four weeks was surveyed between 2.64% and 2.82%. The short-term COFIX is calculated based on short-term funds with a contract maturity of three months.

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