Dah Sing Bank has introduced a tax-loan product at lending rates below the prime rate for larger loan amounts in a bid to achieve an ambitious growth rate target of more than 50 per cent.
Assistant general manager Shera Lee said she believed this was the first time in Hong Kong that a bank had offered unsecured loans at 'sub-prime' rates.
Only those customers who borrow $400,000 or more can enjoy the lowest monthly flat rate of 0.27 per cent, which when added to the 1 per cent premium on the life insurance covering amount, is equivalent to an annualised rate of 8.08 per cent.
This is below the prevalent prime rate of 8.5 per cent.
Customers also need to be home-owners and the bank's 'preferred customers' - civil servants or professionals - before they can enjoy the low lending rate.
Ms Lee would not say how many customers would be eligible for this lending rate, but she said most of the customers would borrow about $100,000.