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HKMA Reportedly Intensifies Scrutiny on Lenders' Distressed Loan Decisions
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Hong Kong regulators intensified scrutiny of lenders' distressed loan decisions in recent months, more frequently calling banks to assess their willingness to extend credit lines to smaller developers, Bloomberg quoted sources as saying. Meanwhile, banks are also reassessing the issue of overvalued loan collateral. It is reported that, since May, several banks have received at least three calls from the Hong Kong Monetary Authority (HKMA), inquiring about reasons for not participating in certain property refinancing transactions and other issues. For instance, LAI SUN DEV (00488.HK) began negotiations with lenders in January to refinance a $3.6 billion loan. However, after nearly six months of negotiations, only about half of the initial 20 lenders expressed willingness to extend the credit line. In the weeks before the maturity of LAI SUN DEV's loan on 6 October, at least five banks in the consortium received calls from the HKMA regarding the refinancing issue for LAI SUN DEV, the report quoted sources as saying. Other companies under HKMA's attention reportedly include EMPEROR INT'L (00163.HK), Gaw Capital Partners and SPRING REIT (01426.HK). AASTOCKS Financial News Website: www.aastocks.com |
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