INVESTMENT BANKING | Staff Reporter, Hong Kong

European banks slow down lending in ominous omen

European banks have begun lending less to Hong Kong in December, fueling fears the Eurozone contagion could be worsening.

Loans from European banks to clients in Hong Kong fell 6% in December from November, but it is still too early to say if euro zone lenders are withdrawing from Asia, the Hong Kong Monetary Authority (HKMA) said.

"Overall, European banks' operations in Hong Kong have remained stable," said HKMA Deputy Chief Executive Arthur Yuen.

"The December numbers are still a single point, and whether it's a seasonal issue or the beginning of a trend is still not clear."

For the whole of 2011, however, European loans to Hong Kong rose 5%, Yuen noted.

Under pressure from a spiralling debt crisis at home, many European banks have begun offloading more of the loans they hold in Asia, making it tougher for small and medium-sized companies to borrow.

Read more here.

Do you know more about this story? Contact us anonymously through this link.

Click here to learn about advertising, content sponsorship, events & rountables, custom media solutions, whitepaper writing, sales leads or eDM opportunities with us.

To get a media kit and information on advertising or sponsoring click here.