Some Hong Kong banks decline mortgages for Evergrande's off-plan projects

[HONG KONG] Some banks in Hong Kong, including HSBC and Standard Chartered, are declining loans to buyers of Chinese property developer Evergrande Group's two uncompleted residential projects in the city, three mortgage brokers said on Wednesday.

The steps highlight increasing worries over the indebted company's liquidity among the financial industry. News emerged this week that a Chinese court had frozen a US$20 million bank deposit of Evergrande, and a Chinese city regulator briefly suspended the sales of two of its projects.

Other banks that are halting mortgages include Bank of East Asia, but the brokers said the banks were still approving mortgages for one Evergrande development that had completed construction. They will also grant mortgages for other developments when they complete.

The Chinese developer currently has three developments in Hong Kong - one is ready to deliver to buyers now while two are due to complete construction in August and October.

HSBC declined to comment. Standard Chartered and Bank of East Asia did not immediately respond to request for comment.

Evergrande said in a statement other banks were still positive about approving mortgages for its off-plan units so it expected the impact would be small, and its developments were progressing as scheduled. It did not name any banks in the statement.



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