Slight Decrease in Loan-Deposit Interest Rate Spread of 5 Major Commercial Banks

April 1.152% Points... 0.01%p Decrease from Previous Month
Woori, Hana, NongHyup, Kookmin, Shinhan Order

Last month, the household loan-deposit interest rate spread of the five major commercial banks?KB Kookmin, Shinhan, Woori, Hana, and NH Nonghyup?slightly decreased compared to the previous month. Among them, Woori Bank had the largest household loan-deposit interest rate spread excluding policy-based low-income financial products.

According to the Bankers Association disclosure on the 22nd, the average household loan-deposit interest rate spread (excluding policy-based low-income financial products) of KB Kookmin, Shinhan, Woori, Hana, and NH Nonghyup Banks in April was recorded at 1.152 percentage points. This is a decrease of 0.01 percentage points from the previous month (1.162 percentage points). The household loan-deposit interest rate spread is calculated by subtracting the interest rate on savings deposits from the household loan interest rate; a larger spread indicates a higher margin (profit) due to the difference between loan and deposit interest rates.

This was because the decline in household loan interest rates was greater than the decline in deposit interest rates. The household loan interest rates of these banks fell from 4.692% in March to 4.56% last month, a decrease of 0.132 percentage points, while deposit interest rates dropped from 3.53% to 3.408% during the same period, a decrease of 0.122 percentage points.

Woori Bank had the largest household loan-deposit interest rate spread at 1.22 percentage points, followed by Hana Bank at 1.20 percentage points, Nonghyup Bank at 1.18 percentage points, KB Kookmin Bank at 1.13 percentage points, and Shinhan Bank at 1.02 percentage points.

Including policy-based low-income financial products, Hana Bank had the largest household loan-deposit interest rate spread at 1.24 percentage points, followed by Woori Bank at 1.23 percentage points, Nonghyup Bank at 1.20 percentage points, KB Kookmin Bank at 1.14 percentage points, and Shinhan Bank at 1.13 percentage points.

Among internet-only banks, excluding policy-based low-income financial products, Toss Bank had the largest household loan-deposit interest rate spread at 4.28 percentage points. K Bank followed with 1.54 percentage points, and Kakao Bank with 1.12 percentage points.

Among all 19 banks including regional banks, Jeonbuk Bank had the largest spread at 4.94 percentage points. The smallest was IBK Industrial Bank of Korea at 0.91 percentage points.

[Image source=Yonhap News]

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