HK credit market stable, say bankers

Hong Kong's credit market remains stable, the Hong Kong Association of Banks said, following after Moody's downgrade of the SAR and mainland China.

HKAB chairman Sun Yu said there are no significant changes in credit spreads between mainland and Hong Kong institutions. He said services provided by the Hong Kong banking sector will also remain stable and will not be significantly affected.

As high interest rates and geopolitical tensions have depressed borrowings, Sun believes closer links between Hong Kong and the Greater Bay Area will boost financing needs, and the industry should take advantage of this.

Fitch Ratings will not change its outlook on Hong Kong and mainland China despite Moody's decision, though it predicts weaker growth in the city, said James McCormack, the managing director and global head of sovereign and supranational ratings of the agency.

In other news, the Hongkong and Shanghai Banking Corporation lowered interest rates for some time deposits by 0.2 percentage points.

Staff reporter