Bank of Korea says August bank lending rate climbed to 4.40 percent

The Bank of Korea said Wednesday that the weighted average interest rate on fresh bank loans came to 4.40 percent in August, up 0.13 percentage point from the previous month, while the rate on new savings deposits held at 3.21 percent.

Corporate lending rates rose 0.10 percentage point to 4.30 percent, with loans to large companies up 0.03 percentage point to 4.21 percent and loans to smaller firms up 0.16 percentage point to 4.38 percent. Household borrowing costs rose 0.12 percentage point to 4.76 percent, and mortgage rates climbed 0.18 percentage point to 4.66 percent.

On the deposit side, rates on pure savings deposits slipped 0.02 percentage point to 3.14 percent, while market-linked financial products gained 0.05 percentage point to 3.53 percent. The spread between new loan and deposit rates widened to 1.19 percentage points from 1.06 percentage points a month earlier.

Measured on outstanding balances, the average rate on total deposits rose 0.05 percentage point from the end of July to 2.20 percent, and the average rate on total loans rose 0.03 percentage point to 4.40 percent. The gap between the two narrowed to 2.20 percentage points from 2.22 percentage points.