HK banks see earnings drop 18.6% in 2021

Banks in Hong Kong reported an 18.6% drop in overall earnings last year, according to the Hong Kong Monetary Authority. The city's financial regulator also stressed that net interest margin, a measure of profitability for financials, also plunged below 1% last year but has likely bottomed out. The drop in overall earnings and net interest margins is leaving interest income and profitability of banks pressured under the low-interest-rate environment, according to HKMA's deputy chief executive Arthur Yuen Kwok-hang. Yuen, however, stressed that the pressure on interest margins might ease as the interest rate, which is hovering at a low level, is unlikely to drop further.