New mortgage lending declined further in October, according to the HKMA's monthly survey of residential mortgage lending.
The amount of gross new loans made in October decreased by 13.4% to HK$7.0 billion. The average size of new loans decreased to HK$1.25 million from HK$1.32 million in September.
While the number of new loans approved increased by 9.6%, the average size of new loan approvals reduced to HK$1.18 million. As a result, the amount of new loans approved during October fell by 3.1% to HK$8.2 billion. Loans approved during October but not yet drawn increased by 6.0% to HK$5.5 billion.
The average loan-to-value ratio of new loans approved edged down to 63.7% from 63.9% in September. The average contractual life lengthened to 218 months from 215 months. 99.3% of loans were related to owner-occupied properties.
On the pricing front, 80.2% of new loans approved were priced at more than 2% below the best lending rate, down slightly from 80.5% in September. However, new loans approved at more than 2.25% below the best lending rate increased further to 65.1% from 62.4% in September.
The amount of outstanding mortgage loans shrank by 0.2% following a 0.1% increase in September.
The loan delinquency ratio (measured by the ratio of mortgage loans overdue for more than 3 months to total outstanding mortgage loans) fell to 1.27% from 1.28% in September. On the other hand, the rescheduled loan ratio (measured by the ratio of rescheduled mortgage loans to total outstanding mortgage loans) increased to 0.24% from 0.23% in September.
"Mortgage lending remained subdued in October in the aftermath of 11 September," said Mr David Carse, Deputy Chief Executive of the HKMA. "However, the improvement in the loan delinquency ratio over the last few months has been maintained. The increase in the rescheduled loan ratio in recent months indicates that banks have been entering into more loan restructuring arrangements with borrowers."
Gross loans made for the purchase of properties in Mainland China increased to HK$395 million from HK$48 million in September. The amount of outstanding loans increased by HK$265 million to HK$6.3 billion in October.
For further enquiries, please contact:
Jasmin Fung, Manager (Press), at 2878 8246
Hong Kong Monetary Authority
28 November 2001
Annex
Notes to Annex
- The Residential Mortgage Survey is a continuous monthly survey covering 29 authorized institutions in the banking industry. With effect from end-October 2001, the number of authorized institutions participating in this survey is reduced to 29 from 38 due to consolidation 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.
- Rescheduled loan ratio is measured by a ratio of total amount of rescheduled 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.
