HKMA Reports Decrease in Composite Interest Rate to 2.52% by August 2024

Composite Interest Rate: End of August 2024

The following is issued on behalf of the Hong Kong Monetary Authority:

The Hong Kong Monetary Authority (HKMA) announced today (September 20) the composite interest rate at the end of August 2024 (Note 1).

The composite interest rate, which is a measure of the average cost of funds of banks, decreased by 6 basis points to 2.52 per cent at the end of August 2024, from 2.58 per cent at the end of July 2024 (see Chart 1 in the Annex). The decrease in composite interest rate mainly reflected the decreases in the weighted funding cost for deposits and interbank funds during the month (see Chart 2 in the Annex) (Note 2).

The historical data of the composite interest rate from the end of the fourth quarter of 2003 to the end of August 2024 are available in the Monthly Statistical Bulletin on the HKMA website (www.hkma.gov.hk).

Note 1:The composite interest rate is a weighted average interest rate of all Hong Kong dollar interest-rate-sensitive liabilities, which include deposits from customers, amounts due to banks, negotiable certificates of deposit and other debt instruments, and all other liabilities that do not involve any formal payment of interest but the values of which are sensitive to interest rate movements (such as Hong Kong dollar non-interest bearing demand deposits) on the books of banks. Data from retail banks, which account for about 90 per cent of the total customers' deposits in the banking sector, are used in the calculation. It should be noted that the composite interest rate represents only average interest expenses. There are various other costs involved in the making of a loan, such as operating costs (e.g. staff and rental expenses), credit cost and hedging cost, which are not covered by the composite interest rate.

Note 2: Since June 2019, the composite interest rate and weighted deposit rate have been calculated based on the new local "Interest rate risk in the banking book" (IRRBB) framework. As such, these figures are not strictly comparable with those of previous months.

LegCo delegation begins duty visit to Japan

The following is issued on behalf of the Legislative Council Secretariat:

The Legislative Council (LegCo) delegation (the delegation), led by the President of LegCo, Mr Andrew Leung, began a four-day duty visit in Japan today (December 21) to strengthen ties with Japan and gain a deeper understanding of the latest situations and opportunities of the country in the areas of trade, culture and tourism, fisheries and agriculture, and food safety.

Upon arrival in Tokyo, the delegation had dinner and exchanged views with representatives of the Hong Kong Economic and Trade Office in Tokyo. Members and the Principal Hong Kong Economic and Trade Representative (Tokyo), Miss Winsome Au, discussed issues such as fostering the bilateral economic and trade relations between Hong Kong and Japan, attracting investment, and promoting Hong Kong tourism. Members also gained insight into the latest developments of Japanese culture, and explored the opportunities for collaboration between Hong Kong and Japan’s cultural industries. Mr Leung expressed gratitude to the Hong Kong Economic and Trade Office in Tokyo for their assistance in facilitating this duty visit.

The delegation will continue their duty visit in Japan tomorrow (December 22).

The delegation is led by Mr Leung. The Deputy delegation leader is the Chairman of the Parliamentary Liaison Subcommittee, Mr Tommy Cheung. Other participating Subcommittee members are Mr Jeffrey Lam, Mr Dominic Lee, Ms Nixie Lam, Ms Joephy Chan, Mr Tang Fei and Mr Yim Kong.

LegCo delegation begins duty visit to Japan Source: HKSAR Government Press Releases