Regulatory Alerts2015-02-27
Added · Updated
Prudential Measures for Property Mortgage Loans
The Hong Kong Monetary Authority issued new countercyclical measures on 27 February 2015 to strengthen risk management and curb overheating in the property market. The regulations lower the maximum loan-to-value ratio for self-use residential properties below HK$7 million by up to 10 percentage points and reduce debt-servicing ratio caps for second-home and non-self-use borrowers to 40%. Additionally, authorized institutions using the Internal Ratings-Based Approach must extend a 15% risk-weight floor to existing residential mortgage loans by June 2016 and a 10% floor by June 2015.