"Only 0.05% of Hong Kong Bank Assets Tied to China's Evergrande"…Hong Kong Financial Secretary Says "Will Not Cause Systemic Crisis"

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[Asia Economy Reporter Lim Cheol-young] Amid bankruptcy rumors surrounding Evergrande, China's second-largest real estate developer, Hong Kong's Financial Secretary has stepped in to clarify that Hong Kong banks have low exposure to Evergrande.

On the 3rd, Paul Chan, Hong Kong's Financial Secretary, told the South China Morning Post (SCMP) in an interview, "In the case of Hong Kong banks, exposure to Evergrande accounts for only 0.05% of the total banking sector assets," adding, "This is a very small scale and will not cause any systemic crisis."

The total assets of Hong Kong banks amount to HKD 26.5 trillion, which means that assets related to Evergrande are approximately HKD 14 billion. Evergrande failed to pay USD 47.5 million out of USD 83.5 million in bond interest last month. Additionally, it has not paid loan interest and is reportedly unable to pay principal and interest on investment products to customers.

In response, Chinese Estates Holdings, Evergrande's second-largest shareholder, announced on the 23rd of last month that it plans to sell all its Evergrande shares. Currently, Evergrande's stock price on the Hong Kong stock market has fallen more than 80% from its peak.

Financial Secretary Paul Chan analyzed, "Rumors related to Evergrande have existed for a long time, so in some respects, preparations have already been made," and added, "Since this is an area inaccessible to individual investors, a situation like the Lehman Brothers collapse will not occur."

This content was produced with the assistance of AI translation services.