"Rain in a Drought" 4% Special Deposit Offer Sold Out in 6 Days

As interest rates on deposits at first-tier banks remain stagnant, the enthusiasm for 'special promotions'?like rain in a drought?is heating up. The recent special promotion for time deposits launched by K Bank sold out in less than a week.

According to K Bank on the 13th, the 'CodeK Time Deposit' launched on the 1st reached its 500 billion KRW limit by the 6th. K Bank offered an annual interest rate of 4.0% for deposits with a term of 12 months or more but less than 24 months, without any special subscription conditions. The minimum deposit amount was set at 1 million KRW with no upper limit, which contributed to its popularity.

This special promotion was the first implemented by K Bank this year and played a significant role in increasing the number of subscribers. According to K Bank, time deposit subscriptions increased significantly compared to the previous week. A K Bank representative stated, "Due to the special promotion and a 0.2 percentage point interest rate increase on 3- and 6-month products, overall deposit sales more than tripled compared to the previous week." Currently, with the special promotion ended, the product offers a maximum annual interest rate of 3.8%.

A similar situation occurred at regional banks. BNK Gyeongnam Bank increased the limit for its special promotion product 'This Year’s Deposit (Season 3)' by 700 billion KRW the day before. A BNK Gyeongnam Bank representative said, "The sales pace was faster than expected, so we increased the limit to 2 trillion KRW." This product offers a maximum annual interest rate of 4.10% for a 1-year term when the base rate is combined with a preferential rate of up to 1.05%, and the deposit amount ranges from 1 million KRW to 1 billion KRW.

The popularity of special promotions offering interest rates in the 4% range is because they are like rain in a drought. Until last year, it was not difficult to find high-interest products, with major commercial banks’ representative time deposits approaching 5%, but recently, such products have become scarce in the first-tier banking sector. According to the Bankers Association, the representative time deposit products of the five major banks?KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup?currently offer interest rates around 3.5% to 3.75%, slightly above the base rate.

However, in the second-tier financial sector, such as savings banks and mutual finance institutions, products with interest rates in the 4% range or high-interest special promotions occasionally appear, and information is shared among deposit and investment enthusiasts (Yetech-jok) in financial communities. A mutual finance sector official said, "High-interest products still exist depending on the situation of each cooperative," adding, "Deposit balances are gradually recovering."