Bankers expect home-loan market competition to intensify Wing Lung Bank, one of three lenders that joined the mortgage war yesterday, is offering home loan rates as low as 4.82 per cent, the cheapest to date, for the entire tenor of the loan. Bankers said they expected mortgage competition to intensify and rates to stabilise at about 4.85 per cent. Hang Seng Bank and DBS Bank (Hong Kong) also stepped into the battle. Wing Lung cut its mortgage rate 0.18 percentage point to 3.18 percentage points below its prime rate, 4.82 per cent in real terms, undercutting HSBC's 4.87 per cent and Bank of East Asia's 4.85 per cent. It also offers a cash rebate of up to 0.8 per cent for homebuyers who borrow HK$500,000 or more. BEA is offering 0.9 per cent cash back. Aside from the fixed 4.82 per cent full-term offer, Wing Lung has another mortgage plan at prime minus 3.38 points for the first three years and prime minus 3.15 points thereafter, with a cash rebate of 0.3 per cent. At HSBC, Hang Seng and Bank of China Hong Kong, the prime rate stands at 7.75 per cent while the other banks are at 8 per cent. A Wing Lung spokeswoman said its offers were good until the end of April. Peggy Tam Lai-king, the head of secured lending at Hang Seng, said higher funding costs probably would rule out further sharp cuts in rates. 'I would not be surprised if some banks chose to leave the [mortgage] battlefield and just focus on specific business lines,' she said. Hang Seng yesterday introduced a mortgage deal at 2.9 per cent below prime, or 4.85 per cent, and a 0.8 per cent cash rebate. Customers who apply online will enjoy the new rate when borrowing HK$800,000 or more while those who apply through branches must borrow HK$2 million or more to qualify. DBS cut its mortgage rate 0.15 percentage point to 3.15 points below prime, or 4.85 per cent, with a cash rebate of up to 0.9 per cent. Sunny Cheung Yiu-tong, the head of consumer banking at DBS, said the fierce competition in the mortgage market would continue but further aggressive price cutting was unlikely. 'I think the mortgage rate will stabilise at the current 4.85 per cent level,' Mr Cheung said.