HKMC’s Financial Results Highlights for 2012

The Hong Kong Mortgage Corporation Limited (HKMC) today (Monday) announced the highlights of its audited financial results for 2012 as follows:

2012 Financial Results Highlights

• Consolidated profit after tax was HK$1,126 million (2011: HK$1,256 million)
• Return on shareholders’ equity was 12.4% (2011: 15.5%)
• Capital adequacy ratio was 20.2% (2011: 19.7%)
• Cost-to-income ratio was 15.4% (2011: 11.8%)
• Dividend of HK$750 million (2011: HK$350 million)

2012 Business Performance Highlights

Asset Purchase

• Purchased HK$865 million loan assets (2011: HK$9,683 million)
• Outstanding principal balance of the loan portfolio was HK$25.9 billion as at end-2012 (2011: HK$33.1 billion)

Debt Issuance

• Issued HK$19.1 billion corporate debts (2011: HK$28.5 billion), being the most active corporate debt issuer in the Hong Kong dollar debt market
• Outstanding balance of debt and mortgage-backed securities was HK$36.6 billion as at end-2012 (2011: HK$41.5 billion)
• Credit ratings of AAA (stable) from the Standard & Poor’s and Aa1 (positive) from the Moody’s, same as the ratings of the HKSAR Government

Mortgage Insurance Programme (MIP)

• New mortgage loans drawn down under the MIP amounted to HK$22 billion (2011: HK$26.3 billion)
• Usage rate (being a percentage of the total amount of new mortgage loans drawn down under the MIP to the total amount of new mortgage loans drawn in the Hong Kong residential property market) stood at 11.5% (2011: 11.5%)
• 96% of the loans drawn down under the MIP (in terms of the loan amount) were secured on properties in the secondary market, demonstrating the importance of the MIP to homebuyers in the secondary market

SME Financing Guarantee Scheme (SFGS)

• Approved more than 5,000 applications for the 80% guarantee products under the Special Concessionary Measures with total loan amount of approximately HK$22.7 billion, benefiting over 3,700 local SMEs and about 100,000 related employees

Reverse Mortgage Programme

• Approved 145 applications, with an average property value of about HK$3.7 million and average monthly payout amount of HK$12,500

Microfinance Scheme

• Approved 47 loans with a total loan amount of HK$12.75 million

Further details of the HKMC’s consolidated financial results and financial review for 2012 are set out at Annex A.

Outlook for 2013

The global economic and financial outlook is unclear and it is possible that Hong Kong will continue to see high volatility in the financial markets in 2013.  Moreover, the monetary easing policies adopted by major economies will continue to affect asset prices in Hong Kong.  The HKMC will remain vigilant and stand ready to face any challenges in the year ahead.

Appointment of Board of Directors

The HKMC held its 16th Annual General Meeting today.  Twelve Directors have been re-appointed by the Financial Secretary for another term, namely, Professor K C Chan, Mr Chan Kin-por, Miss Tanya Chan, Professor Anthony Cheung, Mr Eddy Fong, Mr Andrew Fung, Mr Lester Huang, Mr Lee Huat-oon, Ms Starry Lee, Mr Andrew Leung, Dr David Li and Mr Abraham Shek.  The Financial Secretary appointed Mr Jammy Chen and Professor Wong Yuk-shan as new Directors.  Ms Diana Cesar has retired as Director and has not offered herself for re-appointment.  The composition of the new Board of Directors is at Annex B.

According to the Articles of Association of the HKMC, 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 office of these Directors will run until the next Annual General Meeting to be held around April 2014.

The Hong Kong Mortgage Corporation Limited
15 April 2013