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Hong Kong's ZA Bank offers 6% deposit rate, challenging incumbents

Monday 13 January 2020 09:25 CET | News

Hong-Kong-based challenger ZA Bank has announced its arrival with an introductory rate of 6% or higher for deposits.

ZA Bank, one of eight companies preparing to start digital-only banks in Hong Kong, has begun a trial run that pays a select group of depositors over 3 percentage points more than established banks such as HSBC and Standard Chartered. Though many doubt the new banks will be able to maintain such rates, the offer is a warning of upcoming competition for the the city’s USD 410 billion local currency time-deposit business, according to Bloomberg. Standard Chartered, HSBC and BOC Hong Kong pay 1.9% to 2.3% for the maturity.

Groups of companies including Chinese giants Ant Financial and Tencent Holdings were granted licenses to operate virtual banks in 2018 by the Hong Kong Monetary Authority. The launch is now approaching at a time when tensions stoked by pro-democracy protests in the former British colony show few signs of abating. Bloomberg Intelligence anticipates the new banks will find it difficult to make inroads into the city’s loan market, grabbing just a 1.5% share by 2025, since they will be held back by challenges in attracting deposits and high costs for interbank funding.


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Keywords: Za Bank, HSBC, Standard Chartered, interest rate, deposit rate, challenger bank, digital bank, online banking, Hong Kong, Asia, APAC, banking, Hong Kong Monetary Authority, Ant Financial, Tencent
Categories: Banking & Fintech | Online & Mobile Banking
Countries: Hong Kong
This article is part of category

Banking & Fintech