SEOUL, Oct. 28 (Yonhap) — South Korean banks’ lending rates rebounded for the first time in four months in September amid rising market rates, central bank data showed Wednesday.
The average interest rate charged on new bank loans came to 2.66 percent in September, up from 2.63 percent the previous month, according to preliminary data from the Bank of Korea (BOK).
The tally marked the first rebound after banks’ lending rates declined for the third straight month since June due to the impact of the central bank’s policy rate cut in May.
The BOK cut the key interest rate to a record low of 0.5 percent in May after delivering an emergency rate cut of half a percentage point in March to cushion the impact of the new coronavirus outbreak.
The central bank kept the base rate steady in October amid heightened economic uncertainties over the protracted COVID-19 pandemic.
In September, the average lending rate on fresh corporate loans came to 2.7 percent, up 0.02 percentage point from the previous month.
The average rate on new household lending rose 0.04 percentage point on-month to 2.59 percent last month, as rates charged on home-backed loans and unsecured lending rebounded in line with rising market rates.
The average rate for bank deposits, meanwhile, came to 0.88 percent in September, up from a record low of 0.81 percent in August, the BOK said.
South Korean lenders’ loan-deposit spread, a gauge of banks’ profitability from lending, narrowed to 1.78 percentage points in September from 1.82 percentage points in August.