Interest income is 'quick' despite the reduction in additional interest rates, why?

[Anchor]
The banking sector has been raising lending rates since July of this year.

Then, I wondered if the interest income in the third quarter of this year was the highest, but it turned out that it decreased.

Reporter Lee Hyung-won covered why.

[Reporter]
Mortgage Loans Surge Around Metropolitan Area,
The
banking sector has raised the additional interest rate since July.

Looking at the five major banks alone, there are more than 20 rate hikes, including the reduction of preferential interest rates.

In line with the financial authorities' stance to strengthen household debt management, the threshold for loans has been raised.

[Kim Byung-hwan / Chairman of the Financial Services Commission (August): The banking sector and the government need to work together to manage the household debt, which had been managed stably, in a preemptive manner, to be alert about the increase since the first half of this year.]

The size of loans increased and interest rates rose, but interest income decreased.

Interest income in the third quarter was 14.6 trillion won, down 300 billion won from the second quarter and 200 billion won from last year.

Market rates start to fall earlier this year on expectations of a key rate cut,
The
loan interest rate fell sharply, but the deposit rate was relatively small, so the net interest margin plummeted.

[Yang Hyung-yul / Head of the Financial Supervisory Service's Sound Management Team: Interest income decreased from the previous quarter due to a large reduction in net interest margin due to a decrease in the gap between deposit and lending rates despite an increase in interest income assets]

Although additional interest rates rose one after another in the third quarter, this rate was applied only to new loans, which did not affect overall interest profits.

This is because interest has been reduced because existing loans, which are much larger than new deals, only reflect a decline in market interest rates.

[Banking official: As you know, the additional interest rate has gone up a lot, and (for existing loans), the maturity of the mortgage loan is more than 30 years, so the additional interest rate does not change for 30 years. The base rate changes.]

However, as it achieved its highest performance in the first half of the year, cumulative interest income rose to an all-time high even in the third quarter report card, which slowed down a bit.

I'm Lee Hyungwon of YTN.

Video editing: Han Soo-min
Design: Im Saetbyul