Key Information

inSight
Speeches
Speeches by Speaker
Norman T.L. Chan
Peter Pang
Eddie Yue
Arthur Yuen
Zeti Akhtar Aziz
Raymond Li
Edmond Lau
Esmond Lee
Meena Datwani
Vincent W.S. Lee
James Lau
Joseph Yam
Y K Choi
William Ryback
David Carse
Tony Latter
Andrew Sheng
Hans Genberg
Simon Topping
Michael Taylor
The Honourable Donald Tsang
Chen Yuan
Dai Xianglong
Don Brash
Jaime Caruana
Andrew Crockett
Mario Draghi
David Eldon
Stanley Fischer
Timothy F. Geithner
Stephen Grenville
Kenneth G. Lay
William McDonough
Ernest Patrikis
Glenn Stevens
Jean-Claude Trichet
Tarisa Watanagase
Zeti Akhtar Aziz
Carmen Chu
Alan Au
Press Releases
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
Press Releases by Category
Bogus Voice Message Phone Calls
Banking in Hong Kong
Fraudulent Websites, E-mails and Telephone System, and other fraud cases
Granting of Banking Licences
Exchange Fund
Table of Multiples of Notes and Payments for Allotted Amount under non-competitive tender
Table of Multiples of Notes and Payments of Application Amount under non-competitive tender
Tender of Exchange Fund Bills and Notes
Tender Results of Exchange Fund Bills and Notes
Tentative Issuance Schedule for Exchange Fund Bills and Notes
Appointments and Departures
HKMA Pay Review
HKMA Publications
Speeches
The Hong Kong Mortgage Corporation
Hong Kong Note Printing Limited
Hong Kong Institute for Monetary Research
Exchange Fund Investment Limited
Others
Hong Kong Financial Infrastructure
International Relations
Investment Products Related to Lehman Brothers
Monetary Policy
Notes and Coins
Renminbi business
Credit Card Lending Survey
Monetary Statistics
Residential Mortgage Survey
Year 2000
Others
Guidelines and Circulars
Guidelines
Circulars
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
515.5995

Press Releases

The Hong Kong Mortgage Corporation Limited

The Hong Kong Mortgage Corporation Limited (HKMC) made the following announcement today (15 April 2002):

Financial Results for 2001

The audited financial results of the HKMC show that the operating profit after tax for 2001 was HK$255.5 million, an increase of HK$22.4 million or 9.6% over the previous year. Return on shareholder's equity was 9.4 % (2000: 9.4%). The capital-to-assets ratio remained strong at 11.6% (2000: 13.5%). The operating results and a financial review of the HKMC are attached at Annex A.

Total assets of the HKMC increased substantially by 56.5%, from HK$14.84 billion in 2000 to HK$23.22 billion in 2001. Despite the difficult market environment, the HKMC purchased a total of HK$13.2 billion of mortgage loans in 2001, which is more than double the amount purchased in 2000 (HK$6.35 billion). As a result, the outstanding principal balance of the retained mortgage portfolio increased by HK$8.7 billion or 78.4% to HK$19.8 billion as at 31 December 2001.

The Mortgage Insurance Programme (MIP) has gained wider acceptance by homebuyers. In 2001, the HKMC has expanded the Programme to provide insurance cover for equitable mortgages of loan-to-value (LTV) ratio of up to 90% and mortgage loan size of up to HK$8 million. The Corporation received a total of 7,787 applications from 38 Approved Authorized Institutions in 2001, involving a total mortgage amount of HK$14.5 billion (compared with 5,217 applications and total mortgage amount of HK$10.4 billion in 2000). Reflecting the increased market penetration of the MIP, mortgage loans with mortgage insurance accounted for around 10% of new mortgage loans approved in 2001 (2000: 8%). Secondary market transactions account for 87% of the applications received. This reflects that the programme has helped to enhance the liquidity of secondary property transactions.

The HKMC raised a total of HK$15.6 billion through 26 issues of debt securities in 2001, making it the most active issuer of fixed rate debts in the Hong Kong dollar capital market. In 2001, the HKMC introduced a new mechanism of issuing bonds to retail investors through placing banks. The inaugural issue offered in October 2001 attracted a record subscription amount of over HK$651 million from retail investors. As at 31 December 2001, the total outstanding balance of debts issued by the Corporation was HK$20.1 billion.

Appointment of Board of Directors

The HKMC held its fifth Annual General Meeting (AGM) today. 9 Directors were re-appointed by the Financial Secretary for another term, including Mr. Ronald Arculli, Mr. Andrew Chan, Mr. Bernard Chan, Mr. Chan Kwok-keung, Mr. Eddy Fong, Mr. Cliff Forster, Mr. Stephen Ip, Dr. David Li and Mr. Sin Chung-kai. Two new Directors were appointed by the Financial Secretary to replace the Directors who had not offered themselves for re-appointment. The new Directors are Mr. David Lam Yim Nam and Mr. Brian Yiu Chi Pang. The composition of the new Board of Directors is at Annex B.

Mr. David Lam is the Deputy Chief Executive of Bank of China (Hong Kong) Limited. Mr. Brian Yiu is the Head of Debt Capital Markets, Global Markets - Asian Fixed Income of the Standard Chartered Bank.

"On behalf of the Board, I would like to thank the outgoing Directors for their invaluable advice and contribution, without which the HKMC would not have been able to achieve the results it had accomplished," said Mr. Antony Leung, Chairman of HKMC. "I also want to welcome the new Directors and look forward to their support to further develop the business of the Corporation," added Mr. Leung.

Directors of the HKMC are appointed by the Financial Secretary on a personal basis. According to the Articles of Association of the Company, at each Annual General Meeting, all those Directors who are not Executive Directors shall retire but shall be eligible for re-appointment. Hence, the term of appointment of the current Directors (other than the Executive Directors) will run until the next Annual General Meeting to be held around March/April 2003.

 

The Hong Kong Mortgage Corporation Limited
15 April 2002

Annex A

 

THE HONG KONG MORTGAGE CORPORATION LIMITED

(Incorporated in Hong Kong with limited liability
under the Companies Ordinance)

FINANCIAL HIGHLIGHTS FOR 2001

 



2001


2000




HK$'000


HK$'000







Interest income from mortgage portfolio



776,631


736,337







Net interest income



324,430


357,711







Operating income



359,285


392,070







Operating expenses



101,424


98,427







Operating profit before loans provisions



257,861


293,643







Provisions for bad and doubtful loans



35,299


17,229







Taxation credit / (charge)



32,964


(43,308)







Net Profit for the year



255,526


233,106

 


 

At
31 December
2001


At
31 December
2000

 

 

HK$'000

 

HK$'000

 

 

 

 

 

Mortgage portfolio, net

 

19,777,884

 

11,083,025

 

 

 

 

 

Cash and short-term funds

 

1,256,740


2,068,134

 

 

 

 

 

Investment in debt securities

 

1,736,266


1,304,753

 

 

 

 

 

Total assets

 

23,219,832


14,844,616

 

 

 

 

 

Debt securities

 

20,058,550


11,621,000

 

 

 

 

 

Short-term bank loans

 

-

 

427,200

 

 

 

 

 

Shareholder's equity

 

2,846,010


2,590,484


 

 

 

 

Capital-to-assets ratio


11.6%


13.5%


 

 

 

 

Cost-to-income ratio


28.2%


25.1%


 

 

 

 

Net interest margin


1.5%


2.8%


 

 

 

 

Return on total assets


1.2%


1.8%


 

 

 

 

Return on average shareholder's equity


9.4%


9.4%

 

Financial Review

The operating profit after taxation for the year ended 31 December 2001 was HK$255.5 million, HK$22.4 million or 9.6% more than the previous year. The returns on shareholder's equity and total assets were 9.4% and 1.2% respectively.

Interest income from the mortgage portfolio increased by HK$40.3 million or 5.5% to HK$776.6 million as compared to the previous year. The increase in interest income, despite the significant downward adjustment in the mortgage rate in the mortgage market, was due to a significant increase in mortgage purchase by the HKMC in 2001.

The HKMC incurred interest expense of HK$694.6 million (2000: HK$652 million), made up of HK$212.8 million from the short-term bills and money market drawings and HK$481.8 million from the notes issued. By capturing favourable market conditions in 2001, the Corporation has achieved significant savings in funding costs through successful execution of its pre-funding strategy.

For the year ended 31 December 2001, the HKMC earned a net interest income of HK$324.4 million, a reduction of 9.3% as compared to the previous year. The net interest margin ("NIM") of the average interest earning assets was 1.5% p.a. for the full year (2000: 2.8% p.a.).

Other net income of HK$34.9 million mainly included early prepayment fee income of HK$6.4 million, MBS guarantee fee income and other servicing income of HK$4.6 million, and net mortgage insurance premium of HK$24.2 million.

Under the Mortgage Insurance Programme ("MIP"), the risk-in-force increased from HK$1.55 billion to HK$2.85 billion. Of which, a sum of HK$2.34 billion was ceded to the mortgage reinsurers and the balance of HK$513 million was assumed by the HKMC under a risk-sharing arrangement.

The HKMC continued to exercise tight control over its operating expenses. Total operating expenses were HK$101.4 million for 2001 (2000: HK$98.4 million). The cost-to-income ratio remained low at 28.2%.

As at 31 December 2001, the delinquency ratio of the Corporation's retained mortgage portfolio was 0.29%, which is well below the 1.22% of the banking industry. An additional specific provision of HK$25.7 million was made in 2001. The capital-to-assets ratio ("CAR") stood at 11.6% at 31 December 2001 (2000: 13.5%). This is well above the minimum CAR of 5% stipulated in the guidelines issued by the Financial Secretary.

 

Annex B

The Hong Kong Mortgage Corporation Limited
Board of Directors

The Honourable Antony LEUNG, GBS, JP
(Chairman)

Financial Secretary

Mr. Joseph YAM Chi-kwong, GBS, JP
(Deputy Chairman)

Chief Executive
Hong Kong Monetary Authority

Mr. Norman CHAN Tak-lam, SBS, JP
(Executive Director)

Deputy Chief Executive
Hong Kong Monetary Authority

Mr. Tony LATTER, JP
(Executive Director)

Deputy Chief Executive
Hong Kong Monetary Authority

Mr. Ronald Joseph ARCULLI, GBS, JP

Managing Partner
Arculli and Associates

Professor Andrew Chi-fai CHAN, Ph.D.

Associate Dean, B.A. Faculty
The Chinese University of Hong Kong
Chairman
Consumer Council

The Hon Bernard Charnwut CHAN

Legislative Councillor
Executive Director
Asia Financial Group

The Hon CHAN Kwok-keung

Legislative Councillor

Mr. Eddy C. FONG, SBS, JP

Certified Public Accountant and
Partner
PricewaterhouseCoopers

Mr. Clifford Rowland FORSTER

Deputy Chief Executive &
Regional Director, Asia
Lloyds TSB Bank plc

Mr. Stephen IP Shu-kwan, GBS, JP

Secretary for Financial Services

Mr. David LAM Yim-nam

Deputy Chief Executive
Bank of China (Hong Kong) Ltd.

Dr. the Hon David LI Kwok-po, GBS, LLD (Cantab), JP

Legislative Councillor
Chairman and Chief Executive
The Bank of East Asia, Limited

The Hon SIN Chung-kai

Legislative Councillor

Mr. Brian YIU Chi Pang

Head, Debt Capital Markets
Global Markets - Asian Fixed Income
Standard Chartered Bank

Last revision date: 1 August 2011
ABOUT THE HKMA
The HKMA
Tender Invitations
Careers@HKMA
Legislative Council Issues
Links
The HKMA Information Centre
KEY FUNCTIONS
Monetary Stability
Banking Stability
International Financial Centre
Exchange Fund
PUBLICATIONS & RESEARCH
Annual Report
Half-Yearly Monetary & Financial Stability Report
Quarterly Bulletin
HKMA Background Briefs
Reference Materials
Research
MARKET DATA & STATISTICS
CMU Bond Price Bulletin
Economic & Financial Data for Hong Kong
Monthly Statistical Bulletin
Monetary Statistics
KEY INFORMATION
Press Releases
Speeches
Guidelines & Circulars
Forthcoming Events
inSight
OTHER INFORMATION
Information in Other Languages (Bahasa Indonesia, हिन्दी, नेपाली, ਪੰਜਾਬੀ, Tagalog, ไทย, اردو)
Account Opening
Consumer Corner
Consumer Education Programme
Complaints about Banks
Complaints about SVF Licensees
Internet Banking
Fraudulent Bank Websites, Phishing E-mails and Similar Scams
Be Careful of Bogus Phone Calls and SMS Messages
Authenticate the Callers and Bank Hotline Numbers
Register of AIs & LROs
Register of Securities Staff of AIs
Register of SVF Licensees
Investment Products Related to Lehman Brothers
Photo Gallery