According to statistics published today (30 July 1999) by the Hong Kong Monetary Authority, total deposits in Hong Kong increased, while loans and advances decreased during the month of June. Table 1 provides a summary and comparison with earlier months.
Deposits
Total deposits increased slightly by 0.1% (HK$3.1 billion) in June. As foreign currency deposits increased (0.4%) while HK$ deposits declined (-0.1%), the share of HK$ deposits in total deposits decreased marginally from 57.1% at end-May to 57.0% at end-June.
The decline in HK$ deposits was mainly attributable to a decline in time deposits, which dropped by 1.2% during the month. Demand and savings deposits rose by 3.7% and 2.3% respectively in June.
Foreign currency deposits rose by 0.4% in June. Of the total, US$ deposits declined, while non-US$ foreign currency deposits increased (1.2%). The rise in the latter reflected in part valuation effects.
Loans and advances
Total loans and advances shrank by 1.9% in June. In line with subdued demand in the region, loans for use outside Hong Kong declined by 2.9%, while domestic loans fell by 1.5%. The HK$ loan-to-deposit ratio dropped from 96.7% at end-May to 95.4% at end-June.
Quarterly analysis of loans for use in Hong Kong by major economic sectors
During the June quarter, domestic loans contracted by 3.6%, following a drop of 2.6% in the previous quarter. The decline was across all economic sectors, with the exception of loans for residential mortgages and stockbrokers. Lending to the manufacturing sector and loans for trade financing contracted by 6.4% and 7.3% respectively. Having shrunk by 4.2% in the March quarter, loans for wholesale and retail trade dropped by 8.1% in the June quarter, despite some signs of improvement in the retail sector. Loans for building, construction, and property development and investment declined by 6.0%. Nevertheless, residential mortgage loans increased by 2.1% in the June quarter. Amid buoyant stock market activity, lending to stockbrokers increased substantially by 72.0%, following a rise of 15.5% in the preceding quarter.
Money supply
HK$M1 grew by 2.2% in June, as demand deposits and currency held by the public increased by 3.7% and 0.6% respectively. Meanwhile, both HK$M2 and HK$M3 increased by 0.1% during the month. In the twelve months to June, HK$M1 grew by 7.0%, while HK$M2 and HK$M3 increased by 9.8% and 9.5% respectively.
Note to editor
For enquiries, please contact the Press Section, Hong Kong Monetary Authority. (Telephone: 2878 8261)
Hong Kong Monetary Authority
30 July 1999
Annex
