Wing Lung Bank, which was acquired by China Merchants Bank Co. in 2008, today increased its mortgage rate, becoming the third Hong Kong bank this week to lift the cost of home loans.
The lender will charge a minimum of 0.85 percentage point above the Hong Kong Interbank Offered Rate, or Hibor, effective immediately. Wing Lung previously charged 0.7 percentage point over Hibor.
Meanwhile, Citigroup Inc. (C) is considering raising its mortgage rate and will announce details next week, said Lawrence Lam, director of sales and secured lending at Citibank Global Consumer Group in Hong Kong. Citigroup is currently charging 0.7 percentage point over Hibor.
Hang Seng Bank Ltd. (11) and Standard Chartered Plc (STAN) earlier this week announced plans to lift their mortgage charges. The two lenders now price new mortgages at a rate of 0.8 percentage point to 1 percentage point above Hibor. Standard Chartered’s previous rate was 0.7 percentage point, while Hang Seng didn’t disclose what it used to charge.
The U.S. Federal Reserve’s purchase of an additional $600 billion of Treasuries will add to the risk of a housing bubble in Hong Kong and may force extra measures to cool prices, Norman Chan, the head of the city’s central bank, said today.
The Hong Kong Monetary Authority will “take measures that are specific to the housing market if necessary,” Chan said at a press briefing.
Monetary easing to spur growth in developed economies has sparked inflows of cash to Asia, threatening surging prices for stocks, real-estate and consumer goods. Hong Kong has already tightened purchase requirements after home prices rose about 50 percent from the start of 2009 to the highest level since 1997, according to an index compiled by Centaline Property Agency Ltd.
Bank of East Asia Ltd. (23), BOC Hong Kong Holdings Ltd. (2388), DBS Group Holdings Ltd. (DBS), Fubon Bank (Hong Kong) Ltd., HSBC Holdings Plc (HSBA) and Wing Hang Bank Ltd. (302) said their mortgage rates remain unchanged.
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