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HSBC cuts best loan rate in HK to 5%

HSBC Holdings PLC, the bank with the biggest network in Hong Kong, said it would cut its best lending rate in the city by a quarter of a percentage point to 5 percent.

The reduction, the first since March, will take effect on Monday, the bank said in a statement.

“The interbank rates have come down, so there’s room for a rate cut,” spokeswoman Yvonne Chuang said by telephone yesterday.

The benchmark three-month Hibor fell 20 basis points to 2.237 percent yesterday, the lowest since Sept. 16. The Hong Kong Monetary Authority reduced the city’s base rates twice last month and added liquidity by buying US dollars with Hong Kong dollars to ease the credit squeeze deepened by the collapse of the US’ Lehman Brothers Holdings Inc on Sept. 15.
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