Following the Bank of Korea's decision to lower the base rate by 0.25 percentage points on the 29th of last month, banks are rapidly reducing their deposit rates in response.
According to the Korea Federation of Banks on the 3rd, as of the 2nd, the highest rate for representative 1-year maturity time deposits from the five major banks (KB Kookmin, Shinhan, Hana, Woori, NH Nonghyup) was between 2.55% and 2.85%. Compared to a month ago (2.58% to 3.1%), rates have generally decreased, and products offering rates in the 3% range have become hard to find.
SC First Bank lowered the rates on five types of fixed-term deposits by up to 0.2 percentage points the previous day. Accordingly, the rate for 1-year maturity products was adjusted from the previous 2.15% to 2.05%, while the rate for online products of the same maturity was adjusted from 2.6% to 2.5%.
NH Nonghyup Bank lowered the rates on fixed and savings deposits by 0.25 to 0.3 percentage points, and the rates for subscription deposits and housing savings by 0.25 percentage points each. Internet-only banks such as KakaoBank, Kbank, and Toss Bank also uniformly lowered their rates.
With the Bank of Korea indicating it will lower the base rate in the second half of this year, deposit rates are expected to decrease further. Bank of Korea Governor Lee Chang-yong stated on the 29th of last month, "Four out of six monetary policy committee members expressed the opinion that we should keep the possibility of lowering the current rate of 2.50% within the next three months open."
As deposit rates are expected to decline, the deposit balances of the five major banks reached 940.8675 trillion won at the end of last month, an increase of 18.3953 trillion won in just one month. Regular savings also recorded an increase of 1.1964 trillion won during the same period, reaching 41.6654 trillion won, marking increases for four consecutive months.