A Promotional sign about a bank's loan program is set up in front of a bank in Seoul, Feb. 23. Yonhap
The average lending rate of major banks in Korea dropped for the fifth consecutive month in February to the lowest since August 2022, data showed Monday.
COFIX, or the Cost of Funds Index, a benchmark lending rate for mortgage loans, came to 2.97 percent last month, down 0.11 percentage point from the previous month, according to the data from the Korea Federation of Banks.
The February reading marks the lowest since August 2022, when the comparable figure was 2.96 percent, the data showed.
COFIX is calculated based on the funding costs by eight domestic banks in Korea. They include Nonghyup Bank, Shinhan Bank, Woori Bank and Citibank Korea.
Last month, the Bank of Korea lowered its policy rate by a quarter-percentage point to 2.75 percent, which marked the third reduction in the current monetary easing cycle after the policy pivot in October.
The central bank hinted at up to two additional interest rate cuts this year in an effort to spur economic growth.
In line with falling lending rates, household loans extended by all financial institutions rose 4.3 trillion won ($2.97 billion) last month from a month earlier to reach 1,667 trillion won, shifting from an on-month dip the previous month.
In particular, household loans extended by banks rose for the first time in three months in February. (Yonhap)
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