South Korea’s new short-term Cofix rate raises concerns

Author: Ashley Lee | Published: 29 Aug 2012

Investigations into nine of the ten brokerages submitting three-month rates for South Korea’s certificate of deposit rates (CD rates) prompted the country’s Financial Services Commission (FSC) to introduce the Cost of Funds Index (Cofix) as a benchmark for short-term lending rates. But there are issues with Cofix setting too

Following demand for a new short-term loan rate, FSC introduced a three-month Cofix rate for short-term loans, which will be announced once a week beginning in November.

Cofix, which has been...