--- title: "S&P: «More Collateral Pain is Likely» for Hong Kong" description: "S&P reports that Hong Kong lenders may face \"more collateral pain\" as the commercial property market stabilizes, with office rents projected to fall by 1% and retail by 2% in 2025. Despite signs of st" type: "news" locale: "en" url: "https://longbridge.com/en/news/277144057.md" published_at: "2026-02-27T05:07:24.000Z" --- # S&P: «More Collateral Pain is Likely» for Hong Kong > S&P reports that Hong Kong lenders may face "more collateral pain" as the commercial property market stabilizes, with office rents projected to fall by 1% and retail by 2% in 2025. Despite signs of stabilization, S&P warns it is too early to declare a market bottom, citing ample office supply and competition. The report anticipates further declines in commercial real estate loans in 2026, although Hong Kong's banking system is expected to remain resilient even under severe collateral value discounts, thanks to reduced exposure and strong earnings. However, small banks with high exposure to non-prime properties may face vulnerabilities. **Lenders in Hong Kong are expected to experience «more collateral pain», according to an S&P report, which said it is too early to call the bottom on the city’s commercial property market.** There are signs of stabilization in Hong Kong’s commercial property market with office rents falling by 1 percent in the second half of 2025 and retail by 2 percent compared to declines of 5 percent and 7 percent, respectively, in 2024. However, «it's too early to call a bottom», according to an S&P Global Ratings report citing ample supply of office space and competition faced by local retailers, including cross-border offerings. «In our base case, we assume further downside, though less than last year,» the report said. As a result, S&P believes that «more collateral pain is likely this year for Hong Kong banks» with the continued downturn of commercial real estate loans in 2026, as rents keep sliding. **Still Resilient Under Severe Shocks** Still, the credit rating agency remains confident that Hong Kong’s banking system as a whole would remain resilient even under a sever hypothetical 50 percent discount in the collateral value of commercial properties. This is due to bank efforts in the last five years to reduce exposure as well as solid earnings and excess capital to absorb potential losses. Large banks are better positioned to absorb stress due to diversified loan portfolios, strong earnings capacity and robust risk management. On the other hand, a subset of small banks with «high exposure to non-prime commercial properties, weaker earnings buffers, and aggressive risk appetite» are vulnerable to tail risks. «These tail risk exposures warrant close monitoring despite the system's overall strength,» S&P added. ### Related Stocks - [00011.HK - HANG SENG BANK](https://longbridge.com/en/quote/00011.HK.md) - [02388.HK - BOC HONG KONG](https://longbridge.com/en/quote/02388.HK.md) - [07300.HK - FI CSOP HSI](https://longbridge.com/en/quote/07300.HK.md) - [07500.HK - FI2 CSOP HSI](https://longbridge.com/en/quote/07500.HK.md) - [517900.CN - China Merchants CSI BANK AH Price ETF](https://longbridge.com/en/quote/517900.CN.md) - [601939.CN - CCB](https://longbridge.com/en/quote/601939.CN.md) - [00939.HK - CCB](https://longbridge.com/en/quote/00939.HK.md) - [01398.HK - ICBC](https://longbridge.com/en/quote/01398.HK.md) - [516210.CN - Huaan CSI Banks ETF](https://longbridge.com/en/quote/516210.CN.md) - [512700.CN - China Southern CSI Banks ETF](https://longbridge.com/en/quote/512700.CN.md) ## Related News & Research | Title | Description | URL | |-------|-------------|-----| | 交行零售转型步入深水区 | 2 月 27 日，交通银行公告董事会已审议通过《关于深化零售板块体制机制改革的议案》； 决议的落地，意味着… | [Link](https://longbridge.com/en/news/277200927.md) | | 标普指出，尽管房地产行业面临极端冲击，香港银行的资本化水平仍将保持强劲 | 标准普尔表示，尽管房地产行业遭遇极端冲击，香港银行的资本化仍将保持强劲 | [Link](https://longbridge.com/en/news/277025602.md) | | 银行，新年开始招人了！ | 春节假期后，多家业绩优秀的银行如招商银行、苏州银行等已启动春季招聘，吸引 2026 届毕业生。苏州银行在 2 月 25 日发布招聘公告，提供管理培训、业务培训等岗位，目标为普通高等院校应届生。青岛农商银行也在同日启动招聘，岗位主要集中在一线 | [Link](https://longbridge.com/en/news/277097665.md) | | 韩国央行点阵图显示：在 21 位董事会成员中，有 4 位预测未来六个月的政策利率将维持在 2.25% | BOK 点阵图：21 位董事会成员中有 4 位对未来六个月的政策利率预测为 2.25% | [Link](https://longbridge.com/en/news/276985232.md) | | 汇丰控股将国泰航空的评级从限制上调至买入，目标价定为 16 港元 | 汇丰控股将国泰航空的评级从限制提升至买入，目标价为 16 港元 | [Link](https://longbridge.com/en/news/277025631.md) | --- > **Disclaimer**: This article is for reference only and does not constitute any investment advice.