Regulatory Alerts2013-02-22
Added · Updated
Prudential Measures for Property Mortgage Loans
The Hong Kong Monetary Authority issued new macroprudential measures to strengthen risk management in authorized institutions' mortgage lending amid rising property market risks. The regulations increase the stress testing mortgage rate adjustment to at least 3 percentage points, lower loan-to-value limits for non-residential properties by 10 percentage points, and restrict car park space mortgage terms to a maximum 15-year tenor. Additionally, a 15% risk-weight floor is imposed on all residential mortgage loans granted by Internal Ratings-Based authorized institutions to ensure higher regulatory capital buffers.