HKMA: Hong Kong's SME credit conditions improved slightly in Q3.

On November 6, the Hong Kong Monetary Authority (HKMA) released the results of the "Survey on SME Loan Conditions" for the third quarter of 2026. The survey shows that credit conditions for Hong Kong SMEs improved slightly. Regarding SMEs' perception of banks' loan approval stance (i.e., the degree of difficulty), excluding respondents who answered "no opinion/don't know," 83% considered banks' loan approval stance in Q3 2026 to be "no different" or "easier" compared with six months earlier, up from 78% in the previous quarter. 17% considered banks' stance "more difficult," compared with 22% in the previous quarter. The perception of greater difficulty in obtaining loans does not necessarily reflect substantive difficulties faced by SMEs in borrowing, but may be influenced by multiple factors (such as media/news reports, business operating conditions, and opinions of relatives and friends). Among respondents with approved loans, 2% said banks' stance on their loans had "tightened," down from 4% in the previous quarter. In this survey, tightened lending encompasses various possibilities, such as reducing standby credit lines and loan amounts, raising credit interest rates, increasing collateral requirements, or shortening loan tenors. Therefore, respondents' indication of banks' stance on their loans does not directly reflect banks' actual lending to SMEs. The survey also collected results on SME applications for new loans. 2% of respondents said they had applied to banks for new loans in Q3 2026. Among respondents with known application outcomes, 78% said their applications were fully or partially successful, down from 85% in the previous quarter. As the number of SMEs with approved loans and those applying for new loans during the quarter was relatively small, accounting for only 18% and 2% of surveyed SMEs respectively, survey results are prone to greater volatility and should be interpreted with caution.