The Development Bank of Singapore is shifting its focus away from its mortgage business in Hong Kong, as the bank expects margins to remain substantially low. 'Prices have reached the point where there isn't too much upside,' Sebastian Paredes, chief executive of DBS Hong Kong, said. Abundance of global liquidity, deepened by the latest round of quantitative easing in the United States, has pushed interest rates to a historic low, Paredes said. But he expects the decline in the bank's margins to slow down from the pace of the past two years. DBS raised mortgage rates in Hong Kong in July five basis points to 0.75 percentage point above the Hong Kong interbank offered rate (Hibor). Several other banks in Hong Kong, including Hang Seng Bank, Standard Chartered and Wing Lung Bank, raised their mortgage rates slightly in the last two weeks to stay on top of the cutthroat mortgage market, but analysts said banks are unlikely to make substantial changes to rates. The mortgage delinquency rate has been as low as 0.1 per cent since September, while bank reserves were HK$148.6 billion last week, the Hong Kong Monetary Authority says. Sharmaine Lau, the chief economic analyst at mReferral, said DBS might want to de-emphasise its mortgage book because of its relatively small share (1.5 per cent) of the city's mortgage market. In the face of low profits from the mortgage business, DBS said it will focus more on providing services to small and medium-size enterprises in Hong Kong and on the mainland. It plans to expand its Hong Kong workforce 20 per cent next year from about 3,600 people. DBS will also at least double its staff on the mainland over the next three years from about 1,000 now, Paredes said.