May New COFIX 0.82%... Same as April (Update)

[Asia Economy Reporter Kiho Sung] The COFIX (Cost of Funds Index), which serves as the benchmark for variable interest rates on mortgage loans in the banking sector, remained at the same level as the previous month.

According to the Korea Federation of Banks on the 15th, the COFIX based on new contracts in May was 0.82%, unchanged from April.

Commercial banks will reflect the May COFIX rate level disclosed on this day in new variable-rate mortgage loans starting from the 16th. COFIX is the weighted average interest rate of funds raised by eight domestic banks, reflecting 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, and when COFIX rises, the opposite is true.

Meanwhile, the COFIX based on outstanding balances in May was 1.02%, down 0.02 percentage points from April (1.04%). Both new contract-based and outstanding balance-based COFIX reflect interest rates of deposit products including time deposits, installment savings, mutual installment savings, housing installment savings, negotiable certificates of deposit, repurchase agreements, commercial paper issuance, and financial bonds (excluding subordinated bonds and convertible bonds).

The "new outstanding balance-based COFIX" was 0.81%, maintaining the same level as in April.