Deposit Rates Rise to 3.4% as Major Banks Adjust Interest Rates

Major commercial banks are raising deposit rates in response to rising market interest rates.

According to the financial sector on September 10, Hana Bank increased the interest rate on its flagship one-year term deposit product, 'Hana's Time Deposit,' from 3.2% to 3.3%, a 0.1 percentage point rise. This follows a previous increase in July, when the rate was raised from 2.9% to 3.2%.

Woori Bank also raised the interest rate on its main deposit product, 'WON Plus Deposit,' from 3.2% to 3.4%, an increase of 0.2 percentage points.

Shinhan Bank raised the interest rate on its flagship product, 'Soleunhan Time Deposit,' from 3.2% to 3.4% the day before, also by 0.2 percentage points. KB Kookmin Bank is reportedly considering increasing its deposit rates as well.

NH Nonghyup Bank plans to raise the interest rates on its 'NH All-in-One e-Deposit' starting September 11, by 0.2 to 0.3 percentage points depending on the term. For terms of six months to less than 12 months and 12 months to less than 24 months, the rates will increase by 0.2 percentage points, while for terms of 24 months to less than 36 months, the increase will be 0.3 percentage points. Consequently, the interest rate for the 12-month term will rise from 3.25% to 3.45%. An NH Nonghyup Bank official stated, "This reflects changes in market interest rates, including the Bank of Korea's base rate hike."

As banks continue to raise deposit rates, the total balance of time deposits at major banks has increased to around 1,000 trillion won since early last month. The Bank of Korea reported that the total deposit balance at domestic banks shifted from a decrease of 30 trillion won in July to an increase of 100 billion won in August, with time deposits rising by 20.3 trillion won, marking a significant increase for the second consecutive month after a 42.3 trillion won rise the previous month.