Bankers are fighting a move by the Hong Kong Monetary Authority (HKMA) to assess a bank's property exposure by comparing it to its capital base. They said the measure put them at a disadvantage to overseas rivals that had larger capital bases. The authority has ruled that a bank's property-related exposure should not exceed 2.5 times its capital base. Property stocks tumbled yesterday amid speculation the new move would slow rises in home prices and trim property developers' margins. Henderson Land plunged 3.47 per cent to $69.50 while Sun Hung Kei Properties fell 2.43 per cent to $90.50. Cheung Kong also eased $1.64 or 1.25 per cent to $75. The Hang Seng property sub-index slumped 588.02 points, or 2.32 per cent, to 24,724.69, reaching its lowest since May 2. An authority spokesman tried to ease concerns by saying the proposal was not intended as a strict rule but would be used by the authority's bank examiners when they had to advise a bank on whether to stabilise or reduce its exposure. The practice would apply only to banks that had more than 40 per cent of their loans in the property sector. 'This measure will not be an industry-wide practice,' the spokesman said. Despite the authority's insistence the measure should not place local banks at a disadvantage, Hong Kong bankers criticised the move. Liu Chong Hing Bank executive director Nam Lee-yick said the practice was unfair to Hong Kong banks, as foreign banks generally had strong capital backing from their parents. If the new measure was to be implemented fairly, the authority should require foreign banks to allocate some capital to Hong Kong to back their lending here. Another banker said the practice fell short of internationally accepted banking practice, as no rival jurisdictions had implemented such a measure. He said banks' high property exposure was a natural consequence of rapid increases in home prices in Hong Kong over a number of years, as well as strong demand for home loans. 'We might need to lend three times more to finance a home purchase than we did five years ago,' he said. This apparent 'over-concentration' of risk in property lending could not be solved unless the government gave a more detailed and promising plan to increase land supply to stabilise home prices, he said. Bank of East Asia executive director Joseph Pang reiterated chairman David Li Kwok-po's position that the bank opposed any further government restrictions on home loans.