Credit Card Receivables in Hong Kong Experience Slight Decline in Third Quarter of 2024

The Hong Kong Monetary Authority (HKMA) recently released its credit card lending survey results for the third quarter of 2024, showcasing a slight decrease in total card receivables. The report indicates a 0.6% decline in credit card receivables, amounting to HK$150.3 billion by the end of September 2024. This is following a smaller decrease of 0.2% in the previous quarter.

Understanding Delinquency and Charge-off Ratios

The combined delinquent and rescheduled ratio saw a slight uptick, reaching 0.40% at the close of September, as opposed to 0.39% in the previous quarter. Despite this increase, the quarterly charge-off ratio remained steady at 0.58%, indicating a consistent rate of debt treated as uncollectible.

Insights into Market Context

The marginal decline in credit card receivables could mirror broader economic conditions, as consumers adapt to the financial landscape post-pandemic. The stable charge-off ratios suggest that while some consumers may be facing challenges, overall credit card debt remains manageable for the majority.

Implications for the Financial Sector in Hong Kong

The findings from the HKMA report have significant implications for financial institutions in Hong Kong, potentially influencing their lending practices and credit evaluations. As the economic landscape evolves, banks and financial entities might need to recalibrate their strategies to mitigate risks associated with credit card lending.

For a more in-depth analysis, kindly refer to the Hong Kong Monetary Authority’s report.

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