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Banks' lending rates rise in November for first time in 3 months

Published: 29 Dec. 2025, 14:11 Updated: 29 Dec. 2025, 18:23

Customers wait at a KB Kookmin Bank western Seoul branch in Yeouido on Nov. 24. [YONHAP]

Banks' overall loan rates rose for the first time in three months in November on rising mortgage and corporate lending rates, data showed Monday.

The average interest rate on new bank loans came to 4.15 percent last month, up 0.13 percentage point from September, according to the data from the Bank of Korea (BOK).

It marked the first on-month increase since August.

In detail, the average rate on corporate loans rose 0.14 percentage point to 4.1 percent, posting its first increase in six months.

The rate on new household loans climbed 0.08 percentage point to 4.32 percent, marking a second consecutive monthly gain, as home-backed mortgage loans jumped 0.19 percentage point to 4.17 percent amid tighter lending regulations.

The government has introduced stricter rules on home purchase loans to cool the overheated property market and rein in household debt.

"Changes in expectations about the future path of the policy rate led to a larger rise in benchmark interest rates," Kim Min-soo, a Bank of Korea official, said.

At its latest rate-setting meeting last month, the central bank kept the benchmark rate unchanged for a fourth straight meeting to safeguard financial stability amid a weaker won and an unstable housing market.

BOK Gov. Rhee Chang-yong has said the central bank is weighing both further rate cuts and holding rates, adding that future policy will be data-dependent.

The BOK began its monetary easing cycle in October 2024 with a 0.25 percentage point cut to 3.25 percent and has since lowered the key rate to 2.5 percent in an apparent move to support economic growth.

Yonhap