Hong Kong Monetary Authority: The non-performing loan ratio of "100% guaranteed special loans" in the fourth quarter of 2025 is 18.67%

Mr. Li Dazhi, Deputy Chief Executive of the Hong Kong Monetary Authority, stated that the non-performing loan ratio of the "100% guaranteed special loan" in Hong Kong in the fourth quarter of 2025 increased to 18.67%, rising by 0.5-0.6 percentage points from the third quarter, with the pace of increase slowing by over 3 percentage points compared to earlier. Mr. Li mentioned that the foreign exchange fund holds a small amount of physical gold, with some part of the commodity investment portfolio related to gold, but not in large quantities. Although the gold price has shown strong gains over the past two years, the recent drop over the weekend, especially in silver prices, was staggering. He stated that there are many uncertainties in the market in the future, including geopolitical factors and the direction of US interest rates. Therefore, the size of the foreign exchange fund needs to diversify risk. He said that precious metals also have investment value, but their price changes are different from bonds. Eddie Yue, Chief Executive of the Hong Kong Monetary Authority, stated that the separate accounts between the foreign exchange fund and the government are effective. By using the 6-year rolling investment return rate of the foreign exchange fund portfolio or the 3-year foreign exchange fund note interest rate as a benchmark, whichever is higher, it can make government investment returns more predictable and stable.