Starting Tomorrow, Variable Interest Rates on Mortgage Loans at Commercial Banks Rise Again
COFIX in September Rises 0.16 Percentage Points to 3.82%
From the 17th, the variable interest rate on mortgage loans (hereinafter referred to as "mudamdae") at commercial banks will increase by 0.16 percentage points. This is because the COFIX (Cost of Funds Index), which serves as the benchmark for mudamdae variable interest rates, rebounded after three months due to the rise in banks' time deposit rates and bank bond rates last month.
According to the Korea Federation of Banks on the 16th, the COFIX based on new transactions in September was recorded at 3.82%. This is 0.16 percentage points higher than August's 3.66%. COFIX recorded 3.70% in May and June, then fell consecutively in July (-0.01 percentage points) and August (-0.03 percentage points), before rebounding last month. Commercial banks plan to reflect the COFIX rate announced on this day in the variable interest rates for new mortgage loans starting from the 17th. The COFIX based on outstanding balances also rose by 0.02 percentage points from 3.86% to 3.88%.
COFIX is the weighted average interest rate of funds raised by eight domestic banks. It reflects changes in interest rates of deposit products such as actual deposits, savings, and bank bonds handled by banks. When COFIX falls, it means banks can secure funds by paying less interest. When COFIX rises, the opposite is true.
Both the COFIX based on new transactions and the COFIX based on outstanding balances are calculated based on interest rates of deposit products such as time deposits, installment savings, mutual installment savings, housing installment savings, negotiable certificates of deposit, repurchase agreements, commercial paper sales, and financial bonds (excluding subordinated bonds and convertible bonds).
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The newly introduced "New Outstanding Balance COFIX," implemented since June 2019, also rose by 0.02 percentage points within a month to record 3.29%. The new outstanding balance COFIX additionally reflects flows of other deposits, borrowings, and settlement funds.
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