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Bank lending rates rise in May
제목 없음 South Korean banks' lending rates climbed in May from a month earlier mainly due to rises in the rates for households, the central bank said Monday.

   The average rate for new loans extended to households and companies stood at 5.76 percent in May, up 0.06 percentage point from the previous month, according to the Bank of Korea (BOK). The May rate marked a turnaround from a fall in April, which snapped the fourth consecutive monthly gain.

   According to the BOK, the average rate for household loans jumped 0.07 percentage point, while the rate rose 0.03 percentage points for corporate loans.

   In May, market rates for certificates of deposit, which are tied to banks' mortgage lending rates, also rose 0.06 percentage point to 3.66 percent.

   The rate on mortgage loans, which account for the bulk of banks' household lending, climbed 0.02 percentage point to 4.90 percent in May, the BOK added.

   Meanwhile, the average rate on bank deposits came in at 3.67 last month, easing 0.01 percentage point from April when the figure reached the highest level since 3.87 percent in January 2010.

   South Korean lenders' loan-deposit spread, a gauge of banks' profitability from lending, reached 3.01 percent last month, remaining unchanged from April, the BOK said.

   The average rate on savings bank deposits came in at 4.91 percent as of end-May, down 0.1 percentage point from the previous month. The average lending rates of savings banks soared 1.31 percentage points to 16.72 percent.

   "Savings banks had sharply hiked deposit rates in March to secure customers' money after they underwent massive deposit withdrawals. But the rate fell for a second straight month as they have trouble coping with a fall in new loans," said Moon So-sang, an official at the BOK.

Source: Yonhap News (June 29, 2011)

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