Banking News

Hong Kong’s three largest banks ease lending rates for the first time since 2008

Hong Kong’s three largest banks ease lending rates for the first time since 2008

(31 October 2019 – Hong Kong) Hong Kong’s three largest banks are lowering their prime rates for the first time in 11 years to support local businesses as the economy slipped into its first technical recession in a decade.

HSBC, Standard Chartered Bank and Bank of China (Hong Kong), the city’s three currency issuers, will all cut their best lending rate by 12.5 basis points, taking their cues from a quarter-point cut in base lending rate by the local monetary authority.

That leaves little room for any of the big banks to further ease rates without hurting their books in one of their better-performing markets, analysts said. While Hong Kong and Greater China provide the biggest source of income, growth in the region has tapered amid the onslaught of US-China trade war. China’s economy grew at the slowest pace on record last quarter, while Hong Kong has slipped into a technical recession amid anti-government protests

The Hong Kong Monetary Authority (HKMA), the city’s de facto central bank, lowered its benchmark rate for the third time in as many months on Thursday in lockstep with another round of policy easing by the US Federal Reserve. All three of Hong Kong’s large banks kept their rates unchanged through the monetary authority’s policy easing in August and September.

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