New mortgage lending continued to rise in March, according to the HKMA's monthly survey of residential mortgage lending.
New loans approved during the month increased significantly by 47.7% to HK$10.7 billion, driven largely by growth in approvals for transactions in the secondary market, which accounted for 41.7% of approvals. Loans approved during the month but not yet drawn also increased considerably by 41.3% to HK$7.8 billion.
Reflecting the increase in loan approvals in February, the amount of gross new loans actually advanced in March rose by 28.4% to HK$7.4 billion. The average size of new loans decreased to HK$1.34 million from HK$1.37 million in February.
The average loan-to-value ratio of new loans approved rose slightly to 61.3% from 60.3% in February. The average contractual life lengthened to 206 months from 201 months. 99.0% of loans were related to owner-occupied properties.
On the pricing front, 75% of new loans approved were priced at more than 2% below the best lending rate, up from 70.8% in February. 45.9% were priced at more than 2.25% below the best lending rate, compared with 34.9% in February.
The amount of outstanding mortgage loans fell by another 0.1% in March.
The loan delinquency ratio (measured by the ratio of mortgage loans overdue for more than 3 months to total outstanding mortgage loans) increased to 1.36% from 1.34% in February.
"Although new mortgage lending increased, margins are continuing to be squeezed. Banks are reminded to adhere to prudent lending criteria and pay attention to borrowers' ability to service their debts amid keen competition," said Mr. David Carse, Deputy Chief Executive of the HKMA.
Gross loans made for the purchase of properties in Mainland China increased significantly to HK$65 million from HK$11 million in February. The amount of outstanding loans decreased further by HK$93 million to HK$5.6 billion in March.
For further enquiries, please contact:
Caitlin Wong, Manager (Press), at 2878 1687 or
Thomas Chan, Senior Manager (Press), at 2878 1480
Hong Kong Monetary Authority
26 April 2001
Annex
Notes to Annex
- The Residential Mortgage Survey is a continuous monthly survey that covering 32 authorized institutions in the banking industry.
- Residential mortgage loans in this survey are loans (include refinancing loans) to private individuals for purchase of residential properties, including uncompleted units, but other than those properties under the Home Ownership Scheme, Private Sector Participation Scheme and Tenants Purchase Scheme.
- Gross new loans made are new mortgage loans drawn down during the surveyed month.
- New loans approved are mortgage loans approved during the surveyed month. The loans can either be drawn down in the same month or in the following months. Loans that are approved but not yet drawn, which have implications for the amount of gross new loans made in the following months, are shown under the item "New loans approved during month but not yet drawn".
- Delinquency ratio is measured by a ratio of total amount of overdue loans to total outstanding loans.
- Co-financing schemes refer to those schemes that involve provision of top-up finance by property developer(s) or other co-financier(s) in addition to mortgage loans advanced by authorized institutions. For loans associated with co-financing schemes, only the portion of loans advanced by authorized institutions are included in this survey.
- Average loan-to-value ratio and average contractual life are average figures weighted by the amount of new loans approved during the surveyed month by individual authorized institutions.
