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The following is issued on behalf of the Hong Kong Monetary Authority:
The Hong Kong Monetary Authority (HKMA) announced today (December 17) the composite interest rate at the end of November 2010.*
The composite interest rate, which is a measure of the average cost of funds of banks, increased slightly by 1 basis point to 0.18% at the end of November 2010, from 0.17% at the end of October 2010 (see Charts 1 and 2 in the Annex). The rise in the composite interest rate in November 2010 reflected increases in longer-term interbank rates** and weighted deposit rates.
The historical data of the composite interest rate from the end of the fourth quarter of 2003 to the end of November 2010 are available in the Monthly Statistical Bulletin on the HKMA website (www.hkma.gov.hk). The next data release is scheduled for January 19, 2011 and will provide the composite interest rate at the end of December 2010.
* The composite interest rate is a weighted average interest rate of all Hong Kong dollar interest bearing liabilities, which include deposits from customers, amounts due to banks, negotiable certificates of deposit and other debt instruments, and Hong Kong dollar non-interest bearing demand deposits on the books of banks. Data from retail banks, which account for about 90% 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.
** During November, HIBORs with maturities of three months or shorter decreased by 1.2 to 8 basis points, while those with maturities of six months or longer increased by 4 to 5 basis points.
Ends/Friday, December 17, 2010
Issued at HKT 16:34
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