Featured Product

    HKMA on Enhancement Measures to 80% and 90% Guarantee Product for SMEs

    May 29, 2020

    HKMA announced that the enhancement measures to the 80% and 90% Guarantee Products under the Small and Medium-Sized Enterprise (SME) Financing Guarantee Scheme takes immediate effect. The enhancement measures were included in the second round of the Anti-epidemic Fund announced by the government in April 2020. The measures include raising the maximum loan amount of the 80% and 90% Guarantee Products and extending the eligibility coverage to listed companies in Hong Kong. In addition, both the existing guaranteed loans and new applications are eligible for an interest subsidy for a maximum period of 12 months, the payments of which will start to be made by the end of June this year.

    Under the enhancement measures, the maximum loan amount per enterprise for the 80% Guarantee Product has been increased from HKD 15 million to HKD 18 million, while the loan amount for the 90% Guarantee Product has been increased from HKD 6 million to HKD 8 million. All borrowing enterprises under the scheme can benefit from the enhancements. In addition, for the requirement of personal guarantee by individual shareholder(s) under the Special 100% Loan Guarantee, applicable percentage of equity interest is being reduced from over 70% to over 50%, which is in line with that for the 80% and 90% Guarantee Products. 

    The government will provide interest subsidy for the 80% and 90% guaranteed loans, with the amount of subsidy subject to a cap of 3%. Each loan is entitled to an interest subsidy for up to 12 months. HKMC Insurance Limited (HKMCI) has reached a consensus with the government and the lenders on the following implementation details:

    • All outstanding loans as of April 30, 2020 will receive the first batch of interest subsidy for up to 3 months, of which payment will be successively made starting from the end of June 2020. The list of lenders that will make payments of interest subsidy by the end of June 2020 has been included in the Annex to the HKMA notification.
    • Payment of subsequent interest subsidy will be made on a monthly basis thereafter.
    • Interest subsidy is applicable to new loan applications successfully submitted before May 31, 2021.

    Keywords: Asia Pacific, Hong Kong, Banking, COVID-19, Credit Risk, Guarantee Scheme, SME, Regulatory Capital, HKMCI, HKMA

    Featured Experts
    Related Articles

    ESAs Issue Multiple Regulatory Updates for Financial Sector Entities

    The three European Supervisory Authorities (ESAs) issued a letter to inform about delay in the Sustainable Finance Disclosure Regulation (SFDR) mandate, along with a Call for Evidence on greenwashing practices.

    November 15, 2022 WebPage Regulatory News

    ISSB Makes Announcements at COP27; IASB to Propose IFRS 9 Amendments

    The International Sustainability Standards Board (ISSB) of the IFRS Foundations made several announcements at COP27 and with respect to its work on the sustainability standards.

    November 10, 2022 WebPage Regulatory News

    IOSCO Prioritizes Green Disclosures, Greenwashing, and Carbon Markets

    The International Organization for Securities Commissions (IOSCO), at COP27, outlined the regulatory priorities for sustainability disclosures, mitigation of greenwashing, and promotion of integrity in carbon markets.

    November 09, 2022 WebPage Regulatory News

    EBA Finalizes Methodology for Stress Tests, Issues Other Updates

    The European Banking Authority (EBA) issued a statement in the context of COP27, clarified the operationalization of intermediate EU parent undertakings (IPUs) of third-country groups

    November 09, 2022 WebPage Regulatory News

    OSFI Sets Out Work Priorities and Reporting Updates for Banks

    The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.

    November 07, 2022 WebPage Regulatory News

    APRA Finalizes Changes to Capital Framework, Issues Other Updates

    The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.

    November 03, 2022 WebPage Regulatory News

    BIS Hub and Central Banks Conduct CBDC and DeFI Pilots

    The Bank for International Settlements (BIS) Innovation Hubs and several central banks are working together on various central bank digital currency (CBDC) pilots.

    November 03, 2022 WebPage Regulatory News

    FASB Proposes Improvements to 2023 GAAP Reporting Taxonomy

    The Financial Accounting Standards Board (FASB) is seeking comments, until November 03, 2022, on the proposed technical and other conforming improvements for the 2023 GAAP Financial Reporting Taxonomy.

    November 03, 2022 WebPage Regulatory News

    ECB Sets Deadline for Banks to Meet Its Climate Risk Expectations

    The European Central Bank (ECB) published the results of its thematic review, which shows that banks are still far from adequately managing climate and environmental risks.

    November 02, 2022 WebPage Regulatory News

    ESAs, ECB, & EC Issue Multiple Regulatory Updates for Financial Sector

    Among its recent publications, the European Banking Authority (EBA) published the final standards and guidelines on interest rate risk arising from non-trading book activities (IRRBB)

    October 31, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8588