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Similarly, NMAC allows greater markup on loans of longer duration.
Loans of longer maturities may be obtained abroad, but the spectre of "original sin", or a country's inability to borrow funds in its own currency, means that such loans are likely to be in foreign money.
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As borrowers devote ever-higher shares of their monthly incomes to repaying their student loans for longer periods of time, they reduce purchases of big-ticket items such as cars and homes, investments in potential new small businesses, and savings for retirement, policymakers have cautioned.
It reduced the cost of borrowing and started offering loans for longer terms of up to 30 days.
The new offerings include BillFloat, which pays customers' bills of up to $200 each, and ZestCash, which makes larger loans for longer periods of time.
And 32% of loans had terms of longer than six years — up from 29% just a year earlier.
Many have switched out of construction loans to longer-term mortgages, reducing their credit risk but increasing their interest-rate exposure because they are less able to reprice assets in line with funding costs.Even those banks that are asset-sensitive must be careful.
However, in a tweet, it said the pilot offer of longer loans was "in response to customer demand".
Though interest rates on 15-year mortgages initially dropped further during the refinancing boom because of their shorter terms, the popularity of longer loans rebounded somewhat when 30-year rates closed the gap.
Interest rate risk (IRR) is intrinsic in maturity transformation and financial intermediation as banks take on short-term liabilities in the form of deposits and create assets in the form of loans with longer maturities and different repricing profiles.
Korea Long-Term Credit Bank, which has just 45 branches, offers loans of five years or longer to companies that want to buy equipment or make investments.
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