[1mm Financial Talk] The Only Place Maintaining 3% Range Amid Rising Mortgage Loan Rates

As the COFIX (Cost of Funds Index), the benchmark interest rate for banks' variable-rate mortgage loans, rises, banks have adjusted the lower bound of mortgage loan interest rates upward to the low to mid 4% range. Only KakaoBank, which emphasizes interest rate competitiveness, maintains rates in the 3% range.

According to the financial sector on the 20th, KakaoBank's variable-rate mortgage loans range from 3.81% to 6.68% annually (as of the 19th). On the same day, the variable mortgage loan rates of the five major commercial banks?KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup?were between 4.23% and 6.98%, with KakaoBank's lower and upper bounds being 0.42 and 0.3 percentage points lower, respectively. This is also lower than K Bank (4.18% to 5.94%), another internet-only bank.

As the COFIX (Cost of Funds Index), which serves as the benchmark rate for banks' variable-rate loans, increased, banks collectively raised their variable mortgage loan rates. The new COFIX for May was 3.56%, up 0.12 percentage points from the previous month (3.44%).

Internet-only banks such as KakaoBank are increasing new loans while maintaining interest rate competitiveness during the rising rate period. According to KakaoBank, the proportion of new mortgage loans (excluding refinancing loans) increased from 43% at the end of March to 48% last month. KakaoBank expanded the scope of mortgage loans to include row houses and multi-family houses in April, so overall mortgage loan performance is expected to have increased further.

The reason internet-only banks maintain mortgage loan interest rate competitiveness is that, unlike commercial banks operating branches, they can reduce costs by providing loans through non-face-to-face services. An internet-only bank official said, "Because there are no recruitment commission costs or brokerage partnership fees, it is possible to set lower interest rates."

There is also analysis that internet-only banks are aggressively increasing mortgage loans secured by collateral to offset the deterioration in asset quality caused by loans to middle- and low-credit borrowers. For this reason, it is expected that mortgage loans secured by collateral will be further expanded in the second half of the year.

Moreover, competition in household loans among internet-only banks is expected to intensify in the second half of this year. Toss Bank, which has so far only handled unsecured loans, plans to start offering jeonse and monthly rent deposit loans in the second half and eventually introduce mortgage loans.

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