SEOUL, April 29 (Yonhap) — Lending rates on fresh loans extended by banks in South Korea dropped sharply from a month earlier last month, central bank data showed Wednesday, apparently following an emergency rate reduction by the central bank.

The average interest rate on fresh bank loans came to 2.91 percent in March, down 17 basis points from 3.08 percent a month before, according to the data from the Bank of Korea (BOK).

Such a drop came after the BOK delivered an emergency rate cut on March 16 to help minimize the fallout from the spread of COVID-19.

In its first emergency rate reduction in over a decade, the BOK slashed the key rate by half a percentage point to a new record low of 0.75 percent.

In March, the rate on fresh corporate loans dropped by a quarter percentage point to 2.94 percent, while the average rate on new household loans came to 2.88 percent, down 0.02 percentage point from a month earlier.

The rate on fresh home-backed loans shed 0.04 percentage point from the previous month to reach 2.48 percent.

The rate paid by banks on fresh deposits came to 1.27 percent in the month, down 0.16 percentage point from 1.43 percent tallied in February.

The gap between the rates paid and charged by banks slightly narrowed to 1.64 percent from 1.65 percent over the cited period.