The following is issued on behalf of the Hong Kong Monetary Authority:
 
     The Hong Kong Monetary Authority (HKMA) published today (November 7) the results of Survey on Small and Medium-Sized Enterprises (SMEs)' Credit Conditions for the third quarter of 2018.
      
     Regarding SMEs' perception of banks' credit approval stance relative to 6 months ago, 77 per cent of respondents perceived similar or easier credit approval stance in the third quarter of 2018, compared with 72 per cent recorded in the previous quarter (Chart 1 in the Annex). 23 per cent of respondents perceived more difficult credit approval stance in the third quarter of 2018, as compared to 28 per cent in the previous quarter.
      
     Of those respondents with existing credit lines, 98 per cent reported that banks' stance on existing credit lines was easier or unchanged in the third quarter of 2018, up from 94 per cent recorded in the previous quarter (Chart 2 in the Annex). 2 per cent of respondents reported tightened banks’ stance in the third quarter of 2018, down from 6 per cent in the previous quarter.
      
     The Survey also gauged the results of new credit applications from SMEs. 3.1 per cent of respondents reported that they had applied for new bank credit during the third quarter of 2018. For respondents who already know their application outcomes, 94 per cent reported fully or partially successful applications; the proportion of respondents that reported fully successful applications increased to 83 per cent from 67 per cent in the survey of the previous quarter (Chart 3 in the Annex). The proportion of respondents that reported unsuccessful application increased from 2 per cent to 6 per cent. It should be noted that owing to a small sample size (i.e. 3.1 per cent of surveyed SMEs), the results on new credit applications from SMEs could be prone to large fluctuations. Care should be taken when interpreting the survey results.
      
About Survey on Small and Medium-Sized Enterprises (SMEs)' Credit Conditions
      
     In light of the importance of SMEs to the Hong Kong economy and concerns about potential funding difficulties facing SMEs over the past few years, the HKMA has appointed the Hong Kong Productivity Council (HKPC) to carry out this Survey, starting from the third quarter of 2016. This Survey is conducted on a quarterly basis, covering about 2 500 SMEs from different economic sectors each time. The results of this Survey can help monitor the development of SMEs' access to bank credit from a demand-side perspective.
      
     The results of this Survey should be interpreted with caution. Similar to other opinion surveys, views collected in this Survey may be affected by changes in sentiment due to idiosyncratic events that occurred over the Survey period, which can make the results prone to fluctuations. Readers are advised to interpret the results together with other economic and financial information. In addition, views collected are limited to the expected direction of inter-quarter changes (e.g. "tighter", "similar" or "easier") without providing information about the magnitude of these changes.
      
     Detailed tables and technical information of this Survey are published on the website of the HKPC (smecc.hkpc.org).

Ends/Wednesday, November 7, 2018
Issued at HKT 16:45

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