Total deposits with authorised institutions fell 3.6% in March, the Monetary Authority says, adding that Hong Kong dollar deposits fell 6.5%, while foreign-currency deposits were virtually unchanged.

The decrease in Hong Kong dollar deposits was in part attributable to an unwinding of placements related to initial public offerings in February.

Total loans and advances shrank 4.4% in March, with loans for use in Hong Kong declining 4.6%, and those for use outside Hong Kong, 3%.

Analysed by currency, Hong Kong dollar loans decreased but foreign currency loans increased. As Hong Kong dollar loans registered a smaller fall than Hong Kong dollar deposits, the loan-to-deposit ratio rose to 83.3% in March.

On a quarter-on-quarter comparison, loans for use in Hong Kong recorded a 0.3% rise during the first quarter, with trade financing registering the highest rate of growth, followed by lending to stockbrokers and financial concerns.

Mortgage loans rise

Loans for residential mortgages also rose slightly, the first quarter-on-quarter rise since June 2002.

On a seasonally adjusted basis, Hong Kong dollar M1 grew 5.1% in March and 45.1% from a year ago.