Variable mortgage interest rates halt their rise for the first time in five months

[Financial News] Last month, COFIX (Cost of Funds Index), the benchmark for variable interest rates on housing mortgage loans in the banking sector, remained at the same level as the previous month.
According to the Korea Federation of Banks (KFB) on the 15th, the COFIX rate based on new loan volume for August this year was recorded at 3.18% per annum, the same as in July.
After rising for four consecutive months from April to July this year and reaching its highest level in one year and seven months since December 2024 (3.22%), the upward trend has stopped.
This is the first time in five years and three months, since April–May 2021 (0.82%), that the COFIX based on new loan volume has remained flat for two consecutive months.
The balance-based COFIX for August rose by 0.05 percentage points from 3.00% to 3.05%. This is the highest level in one year and two months since June 2025 (3.07%).
COFIX is the weighted average interest rate of funds raised by eight domestic banks. It reflects changes in interest rates on deposit products, such as savings accounts and time deposits, as well as bank bonds, that banks actually handle. If COFIX falls, it means banks can secure funds by paying less interest, and if COFIX rises, the opposite is true.
The new balance-based COFIX rose from 2.65% to 2.71% per annum. The new balance-based COFIX includes interest rates on other deposits, borrowings, and settlement funds.
Commercial banks plan to reflect the COFIX rate released today in new variable mortgage interest rates as early as the 16th.

[email protected] Ye Byeong-jeong Reporter