Banks slash rates in mortgage war

Local banks, especially small- and mid-size lenders like Citibank, are aggressively boosting their mortgage business by cutting interest rates and offering cash rebates, according to the Sing Tao Daily.

Citibank cut its mortgage rate to Hibor plus 1.3 percent on loans as low as HK$4 million, while some banks have increased their cash rebate rate to 1.1 percent, according to a source. Among the large banks, BOCHK (2388) may reduce the interest rate to Hibor plus 1.3 percent, subject to individual cases and the loan amount, the source added.

Centaline Mortgage Broker expects the one-month Hibor rate to remain at a 10-year low next year, between 0.1 percent and 0.25 percent. It believes the Hibor-based mortgage will continue to be the mainstream mortgage plan in 2021.

The one-month Hibor rose to 0.27929 percent, a one-month high, yesterday.