HK curbs lending to developers as risks soar
Caps for construction finance to be cut to 40% of site value and 80% of construction cost from June 1
Hong Kong
THE Hong Kong Monetary Authority (HKMA) has tightened limits on bank loans to property developers, as it seeks to contain risks in the city's booming real-estate market.
From June 1, the caps for construction finance will be cut to 40 per cent of site value and 80 per cent of construction cost, with the overall limit reduced to 50 per cent of the expected value of completed properties. For developers with weaker finances, banks should consider deeper cuts, the monetary authority said in a statement last Friday.
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