According to statistics published today (Friday) by the Hong Kong Monetary Authority, total deposits with authorized institutions increased by 9.8% in January 2021. Among the total, Hong Kong dollar deposits and overall foreign currency deposits grew by 18.6% and 1.0% respectively. Renminbi deposits in Hong Kong increased by 10.5% to RMB797.7 billion at the end of January. The total remittance of renminbi for cross-border trade settlement amounted to RMB581.3 billion in January, compared with RMB535.8 billion in December 2020.
Total loans and advances increased by 11.8% in January. Among the total, loans for use in Hong Kong (including trade finance) expanded by 16.7%, and loans for use outside Hong Kong edged up by 0.3%. The Hong Kong dollar loan-to-deposit ratio increased to 83.9% at the end of January from 83.5% at the end of December 2020, as Hong Kong dollar loans increased at a faster pace than Hong Kong dollar deposits.
In January, changes in deposits and loans were partly driven by initial public offering (IPO) activities. Excluding IPO loans and the resulting creation of deposits, total deposits and Hong Kong dollar deposits would have increased by 3.2% and 5.3% respectively in January, and total loans and advances would have increased by 2.6% in January.
Hong Kong dollar M2 and M3 both expanded by 17.3% in January, and grew by 23.3% and 23.2% respectively compared to a year ago. The seasonally-adjusted Hong Kong dollar M1 increased by 5.9% in January, and rose by 31.0% compared to a year ago, reflecting in part investment-related activities. Total M2 and M3 both went up by 9.0% in January, and expanded by 15.2% and 15.1% respectively from a year earlier. Excluding deposits created by IPO loans, Hong Kong dollar M2 and M3 both would have increased by 5.1% in January, and increased by 10.4% compared to a year ago. Total M2 and M3 both would have increased by 2.8% in January, and risen by 8.6% compared to a year ago.
As monthly monetary statistics are subject to volatilities due to a wide range of transient factors, such as seasonal and IPO-related funding demand as well as business and investment-related activities, caution is required when interpreting the statistics.
Hong Kong Monetary Authority
26 February 2021