THE Hang Seng Bank followed Hongkong Bank yesterday, announcing a package of preferential mortgage lending rates for its most valued new customers. Hang Seng said it would slice a percentage point off its standard mortgage rate for many civil servants, while many other customers would qualify for a 0.25 percentage point discount. That would mean civil servants who qualified would only have to pay a 0.75 percentage point over the prime lending rate of 9.75 per cent per annum on their mortgages, instead of the standard 10.75 per cent virtually everyone else pays. This offer was restricted to civil servants on the master pay scale point 34 or above with a home subsidy. The bank said it would cut a 0.25 percentage point off its mortgage lending rate to other valued customers. It defines these as professionals and people holding certain key accounts with the bank, or owners of companies which use Hang Seng as their main bank. Hang Seng's retail banking head W K Mok said: 'We hope that through this preferential offer, we can further enhance our relationship with customers.' Earlier this week, Hongkong Bank set the trend, sending out a memorandum to its branch managers allowing them to offer discretionary discounts of either 25 or 50 basis points to their most valued customers. Unlike Hang Seng, the Hongkong Bank gave no definition of who these might be other than that the offer would be restricted to buyers who were genuine end-users. In the face of stiff opposition from the Monetary Authority to any idea of relaxing its maximum mortgage lending ceiling from the 70 per cent threshold, the territory's leading banks have had to resort to other measures to attract new business. Banks have come under mounting pressure from the general public and industry to relax their maximum mortgage ceiling. While there is nothing legally stopping the banks from lending customers however much they want, they do run the risk of tempting the wrath of the monetary authority's supremos for banking supervision. The authority's deputy chief executive for banking, David Carse, had made it clear the authority still thought it imprudent for banks to raise their caps. While many banks and property developers had been blatantly getting round the problem by offering buyers of flats in new projects a variety of top-up loans and other incentives, the monetary authority thought it was still too early to officially relax the 70 per cent mortgage ceiling. Analysts said the positive psychological impact of the banks doing so could prompt a flood of speculators, investors, and genuine end-users back into the flat-buying market, and this could lead to higher prices.