Banks cut rates for HOS flat mortgages

Competition for government-subsidised Home Ownership Scheme (HOS) mortgages is intensifying with Hong Kong's three largest lenders announcing interest rate cuts.

Hongkong Bank, Hang Seng Bank and Bank of East Asia are to reduce their HOS mortgage rate to 8.125 per cent, lower than the 8.25 per cent offered by SPC Credit and First Pacific Bank announced two weeks ago.

Both SPC Credit and First Pacific Bank said they were reviewing the market but were not yet ready to cut rates to levels in line with those of the three industry giants.

The Hongkong Bank package features an option to choose a step-up repayment scheme in which the monthly instalment is increased once every year according to a pre-determined percentage from 1 to 10 per cent.

Bank of East Asia will continue to waive borrowers' credit card annual fee over the loan's duration.

Hang Seng Bank is offering a six-piece cooking set and a stereo.