Residential Mortgage Survey Results for March 2004

Press Releases

29 Apr 2004

Residential Mortgage Survey Results for March 2004

According to the HKMA's monthly survey of residential mortgage lending, activity in residential mortgage loans remained strong in March.

New loans drawn down during March rose by 39.0% to HK$13.1 billion, the highest since mid-1999. New approvals in March also increased: in value terms by 27.0% to HK$16.0 billion; and in number terms by 29.1% to 10,377 cases. The growth was driven by the 48.0% increase in number of new approvals for secondary market transactions and the 83.3% increase in refinancing loans, which more than offset the 11.7% decrease in primary market transactions. The number of new applications for mortgages registered an increase of 21.0%.

The proportion of new approvals priced at more than 2.5% below the best lending rate declined to 63.8% from 66.7% in February. However, the proportion of new approvals priced other than with reference to the best lending rate (primarily fixed rate mortgages) increased to 12.6% from 8.0% in February.

The outstanding amount of mortgage loans increased further by 0.4% to HK$525.3 billion.

The quality of the mortgage portfolio continued to improve. The mortgage delinquency ratio and the rescheduled loan ratio dropped to 0.70% and 0.49% respectively from 0.79% and 0.51% in February. As a result, the combined ratio improved to 1.19% from 1.30%.

"In anticipation of interest rate increases, fixed rate mortgages have become more popular in recent months," said Mr William Ryback, Deputy Chief Executive of the HKMA. "Banks offering fixed rate mortgage products need to ensure that adequate controls are in place to manage the associated interest rate risk."

For further enquiries, please contact:

Jasmin Fung, Manager (Press), at 2878 8246 or
Kevin Ip, Manager (Press), at 2878 1687

Hong Kong Monetary Authority
29 April 2004


Residential Mortgage Survey

Notes to Annex

  1. The Residential Mortgage Survey is a continuous monthly survey covering 25 authorized institutions in the banking industry.
  2. Residential mortgage loans (RMLs) 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, the Private Sector Participation Scheme and the Tenants Purchase Scheme.
  3. Gross new loans made are new mortgage loans drawn down during the surveyed month.
  4. 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".
  5. Delinquency ratio is measured by a ratio of total amount of overdue loans to total outstanding loans.
  6. Rescheduled loan ratio is measured by a ratio of total amount of rescheduled loans to total outstanding loans.
  7. 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 reporting institutions is included in this survey.
  8. Average loan-to-value ratio and average contractual life for new loans approved during the surveyed month are average figures weighted by the amount of new loans approved during the surveyed month by individual reporting institutions.
  9. Loans written off over the past 12 months as a percentage of the average outstanding loans is calculated as: total value of loans written off during the past 12-month period as a percentage of the average outstanding loan value over the 12-month period [i.e. (opening + closing), 2].
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Last revision date : 29 April 2004