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Monetary Statistics for June 1998

According to statistics published today (July 30, 1998) by the Hong Kong Monetary Authority (HKMA), the repatriation of offshore deposits helped ease liquidity in the banking sector in June 1998. Table 1 gives a summary and comparisons with earlier months.

Deposits

Total deposits rose by 1.4% in June, reversing the declines in the previous two months. Hong Kong dollar deposits rose by 1.0%, while foreign currency deposits grew by 2.0%.

The increase in total deposits is largely attributed to the repatriation of funds into Hong Kong as a result of the 22 June announcement of the exemption of the profit tax on interest income derived from corporate deposits.

Of the HK$ deposits, time deposits rose by 3.7%, but demand and savings deposits fell by 1.9% and 7.1% respectively. Depositors were attracted by higher rates for time deposits offered by banks in mid-June, amidst the renewed volatility in the regional financial markets, in particular, the weakening of the Japanese yen. As foreign currency deposit rose slightly faster than that of HK$ deposits, the share of HK$ deposits to total deposits fell marginally to 57.5% at end-June compared with 57.7% at end-May.

Loans and advances

During the month, total loans and advances declined by 1.8%. Offshore loans remained on a downward trend, dropping by 3.5% in June. The decline was partly due to the valuation effect of a weaker yen. Meanwhile, domestic loans decreased slightly by 0.7% in June. Loans for trade financing contracted further by 0.4%, while other loans for use in Hong Kong dropped by 0.7%. As HK$ deposits rose but HK$ loans fell, the HK$ loan-to-deposit ratio decreased to 111.5% at end-June from 113.2% at end-May.

Quarterly analysis of loans for use in Hong Kong by major economic sector

During the second quarter, the contraction in domestic loans moderated to 0.2%, compared with a 1.2% contraction in the preceding quarter. Loan demand was generally weak along with the slackening economic activities, while banks remained cautious in lending. In line with weak retail sales, loans for wholesale and retail trades declined by 1.5% in the second quarter, having fallen by 4.1% in the first quarter. Likewise, lending to the manufacturing sector and loans for trade financing also declined, shrinking by 1.9% and 2.7% respectively. Amidst thin trading volume of the stock market, lending to stockbrokers fell by 19.6% and loans to financial concerns fell by 5.3% during the quarter.

Nevertheless, property-related loans, which account for about 40% of domestic loans, increased during the quarter. Loans for building, construction and property development and investment rose slightly by 0.4% in the June quarter, having fallen by 0.4% in the preceding quarter. Lending to purchase flats under Home Ownership Scheme and Private Sector Participation Scheme rose sharply by 11.8%, as a substantial number of these types of flats were completed during the quarter. Growth of mortgage loans for other residential properties slowed to 1.7%, compared with 2.2% in the preceding quarter. Meanwhile, loans to the transport sector grew by 3.7% during the quarter.

Money supply

During the month, money supply growth continued to slow. HK$M1 fell by 1.7% in June. Meanwhile, HK$M2 and HK$M3 were both up by 0.8%. In the twelve months to June, HK$M1 dropped by 17.0%, while HK$M2 and HK$M3 grew by 0.4% and 0.3% respectively.

Note to editor

For enquiries, please contact the Press and Publications Section, Hong Kong Monetary Authority. (Telephone number: 2878 8261)

Hong Kong Monetary Authority

30 July 1998

 

TABLE 1 : MONETARY STATISTICS - Jun 1998

(HK$mn)
Earlier months (% change to Jun 1998)
Jun 1998 May 1998 Mar 1998 Jun 1997
Money Supply
M1 - HK$ 170,182 173,107 (-1.7) 185,507 (-8.3) 204,922 (-17.0)
Foreign currency 18,030 17,929 (0.6) 16,414 (9.8) 21,933 (-17.8)
Total 188,212 191,036 (-1.5) 201,921 (-6.8) 226,855 (-17.0)
M2 - HK$@ 1,681,825 1,668,511 (0.8) 1,678,693 (0.2) 1,675,252 (0.4)
Foreign currency* 1,135,410 1,112,648 (2.0) 1,129,853 (0.5) 1,066,146 (6.5)
Total 2,817,235 2,781,159 (1.3) 2,808,546 (0.3) 2,741,399 (2.8)
M3 - HK$@ 1,696,175 1,682,489 (0.8) 1,693,582 (0.2) 1,691,594 (0.3)
Foreign currency* 1,182,120 1,159,218 (2.0) 1,185,249 (-0.3) 1,136,606 (4.0)
Total 2,878,294 2,841,707 (1.3) 2,878,831 (0.0) 2,828,200 (1.8)
Notes and coins in circulation 90,576 92,219 (-1.8) 91,684 (-1.2) 96,801 (-6.4)
of which held by public 79,193 80,347 (-1.4) 81,205 (-2.5) 81,704 (-3.1)
Total Deposits
Total Demand deposits 109,019 110,689 (-1.5) 120,716 (-9.7) 145,151 (-24.9)
Total Savings deposits 464,511 486,751 (-4.6) 517,489 (-10.2) 532,640 (-12.8)
Total Time deposits 2,135,297 2,073,170 (3.0) 2,075,735 (2.9) 1,986,347 (7.5)
With licensed banks 2,087,703 2,026,326 (3.0) 2,020,890 (3.3) 1,924,444 (8.5)
With restricted licence banks 37,046 36,092 (2.6) 42,314 (-12.4) 47,387 (-21.8)
With deposit-taking companies 10,549 10,752 (-1.9) 12,531 (-15.8) 14,516 (-27.3)
HK$ deposits@ 1,556,814 1,541,590 (1.0) 1,557,098 (0.0) 1,566,381 (-0.6)
Demand deposits 90,989 92,760 (-1.9) 104,302 (-12.8) 123,217 (-26.2)
Savings deposits 309,886 333,657 (-7.1) 362,660 (-14.6) 381,297 (-18.7)
Time deposits@ 1,155,938 1,115,173 (3.7) 1,090,135 (6.0) 1,061,866 (8.9)
US$ deposits* 645,634 606,152 (6.5) 617,730 (4.5) 514,910 (25.4)
Other foreign currency deposits* 506,379 522,868 (-3.2) 539,112 (-6.1) 582,846 (-13.1)
Foreign currency deposits* 1,152,013 1,129,020 (2.0) 1,156,842 (-0.4) 1,097,756 (4.9)
All deposits 2,708,827 2,670,610 (1.4) 2,713,940 (-0.2) 2,664,137 (1.7)
Foreign currency swap deposits 35,190 37,528 (-6.2) 40,194 (-12.4) 37,419 (-6.0)
Total Loans and advances
Loans for use in H.K. 2,198,951 2,214,495 (-0.7) 2,203,438 (-0.2) 2,111,502 (4.1)
To finance H.K.'s visible trade 158,588 158,542 (0.0) 162,479 (-2.4) 175,017 (-9.4)
To finance merchandising trade not touching H.K. 18,469 19,251 (-4.1) 19,513 (-5.4) 21,007 (-12.1)
Other loans for use in H.K. 2,021,894 2,036,702 (-0.7) 2,021,446 (0.0) 1,915,477 (5.6)
Loans for use outside H.K.# 1,395,134 1,445,951 (-3.5) 1,517,192 (-8.0) 2,174,520 (-35.8)
Other loans for use outside H.K. 1,358,460 1,402,147 (-3.1) 1,474,825 (-7.9) 2,126,534 (-36.1)
Other loans where the place of use is not known 36,674 43,805 (-16.3) 42,367 (-13.4) 47,986 (-23.6)
Loans in HK$ 1,735,714 1,744,649 (-0.5) 1,732,612 (0.2) 1,685,841 (3.0)
Loans in US$ 715,177 736,923 (-3.0) 742,983 (-3.7) 711,833 (0.5)
Loans in other foreign currencies 1,143,195 1,178,874 (-3.0) 1,245,036 (-8.2) 1,888,348 (-39.5)
Loans in foreign currencies 1,858,372 1,915,797 (-3.0) 1,988,019 (-6.5) 2,600,181 (-28.5)
Total loans and advances 3,594,085 3,660,446 (-1.8) 3,720,630 (-3.4) 4,286,022 (-16.1)
* Adjusted to exclude foreign currency swap deposits.
@ Adjusted to include foreign currency swap deposits.
# Including those where place of usage is unknown.
Note : Data may not add up to total due to rounding.

 

TABLE 2 : QUARTERLY ANALYSIS OF LOANS
FOR USE IN HONG KONG BY SECTOR - JUN 1998

Jun 1998 Adjusted# % change from earlier quarters to Jun 1998
(HK$ Mn)
Sectors Mar 1998 Dec 1997 Jun 1997
Trade Financing 177,057 -2.7 -8.2 -9.7
Manufacturing 105,950 -1.9 -4.7 -7.9
Transport and transport equipment 105,866 3.7 6.5 13.4
Building, construction, property 440,286 0.4 0.1 6.6
development and investment
Wholesale and retail trade 195,428 -1.5 -5.6 -4.0
Financial concerns * 254,397 -5.3 -6.3 2.3
Stockbrokers 7,803 -19.6 -49.5 -63.9
Individuals:
to purchase flats in the Home 66,685 11.8 10.4 14.6
Ownership Scheme and Private
Sector Participation Scheme
to purchase other residential 499,404 1.7 4.0 16.6
property
other purposes 153,772 0.8 -0.1 7.3
Others 192,304 -0.3 -2.7 0.5
Total 2,198,951 -0.2 -1.4 4.1
# With the introduction of the new Return on Loans and Advances and Provisions (as revised from the Return on Loans and Advances
for Use in Hong Kong) as from December 1994, a number of AIs have reclassified certain components. As a result, the figures are not
strictly comparable with those of previous quarters. The percentage changes given above have been adjusted, so far as possible, to
remove the reclassification effect and therefore cannot be calculated directly from the published figures.
* This excludes funds advanced to authorized institutions.
Note : Data may not add up to total due to rounding.
Last revision date: 1 August 2011
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