'Variable-Rate Mortgage' COFIX at 2.54% in June...Down for 9 Consecutive Months

The Cost of Funds Index (COFIX), which serves as the benchmark for variable-rate mortgage loans in the banking sector, has declined for nine consecutive months.

According to the Korea Federation of Banks on July 15, the COFIX based on new loan issuance for June was calculated at 2.54%, down 0.09 percentage points from 2.63% in May, marking a nine-month streak of declines. The balance-based COFIX also fell by 0.07 percentage points, from 3.14% to 3.07%.

COFIX is the weighted average interest rate of funds raised by eight domestic banks, reflecting changes in the interest rates of deposit and savings products, as well as bank bonds actually handled by banks. The "new balance-based COFIX," which was newly introduced in June 2019, also dropped by 0.08 percentage points, from 2.71% to 2.63%.