The banking system's classified loan ratio in Hong Kong - the ratio of bad and doubtful loans- showed no further hike for the first quarter, due to the strong economic performance, said Arthur Yuen Kwok-hang, Deputy Chief Executive of Hong Kong Monetary Authority.
As for the end of 2025, Hong Kong's banking sector recorded a 2.01 percent classified loan ratio, representing a long-term average level, the city's de facto central bank said.
Yuen emphasized that the overall risk of the banking system remains manageable, backed by sufficient provisions, adding that the provision coverage ratio stayed around 65 percent after deducting the value of collateral, compared to over 140 percent including it.
In the first quarter, the banks' deposit amount rose 1 percent, among which the Hong Kong dollar deposit posted a faster growing pace at 1.9 percent, he said.
The credit growth rate also accelerated to 3 percent, as the low borrowing cost drove the credit demand, he added.
Besides, due to the uncertainty of the Middle East conflict, HKMA and the banking sector rolled out five support measures to assist small and medium enterprises, including further increasing dedicated funds for SMEs to over HK$450 million.
The government will offer credit relief to sectors affected by the oil price surge and expedite the approval process for applications under the SME Financing Guarantee Scheme, Yuen said.
Other supports include introducing loans with flexible repayment for SMEs' transformation, and deepening the use of fintech and data to assist SMEs in obtaining bank financing, he added.
𝗗𝗼𝘄𝗻𝗹𝗼𝗮𝗱 𝗧𝗵𝗲 𝗦𝘁𝗮𝗻𝗱𝗮𝗿𝗱 𝗔𝗽𝗽 ↓
