New mortgage lending increased for the third consecutive month in August, according to the HKMA's monthly survey of residential mortgage lending.
The amount of gross new loans made in August increased by 6.3% to HK$11.8 billion. The average size of new loans decreased to HK$1.37 million from HK$1.48 million in July.
New loans approved during August fell by 17.7% to HK$9.5 billion, attributable mainly to a decline in approvals for transactions in the primary market, which fell by 39.1% to account for only 31.7% of the total new loans approved, compared to 42.9% in July. Loans approved during August but not yet drawn decreased by 20.1% to HK$5.7 billion.
The average loan-to-value ratio of new loans approved edged up to 64.1% from 63.2% in July. The average contractual life shortened to 217 months from 219 months. 99.2% of loans were related to owner-occupied properties.
On the pricing front, 79.7% of new loans approved were priced at more than 2% below the best lending rate, down very slightly from 80.4% in July. However, new loans approved at more than 2.25% below the best lending rate edged up marginally to 57.6% from 57.5% in July.
The amount of outstanding mortgage loans grew by 0.6% following a 0.4% increase in July.
The loan delinquency ratio (measured by the ratio of mortgage loans overdue for more than 3 months to total outstanding mortgage loans) decreased for the fourth consecutive month to 1.28% from 1.31% in July.
"Despite the continued decline in the delinquency ratio, banks should be alert to possible adverse effects that may be brought about by the slowing economy," said Mr David Carse, Deputy Chief Executive of the HKMA.
Gross loans made for the purchase of properties in Mainland China increased to HK$124 million from HK$70 million in July. The amount of outstanding loans decreased further by HK$48 million to HK$6.1 billion in August.
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
27 September 2001
Annex
Notes to Annex
- The Residential Mortgage Survey is a continuous monthly survey covering 38 authorized institutions in the banking industry.
- Residential mortgage loans in this survey are loans (including refinancing loans) to private individuals for the 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 is 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.
