Hong Kong Retail Banking Market Size, Share & Trends Analysis and Forecast 2021 – 2025
All the vital news, analysis, and commentary curated by our industry experts.
The retail banking sector in Hong Kong has shown growth despite the recent impact of COVID-19. Residential mortgages and retail deposits recorded the highest compound annual growth rates (CAGRs) in the region, with the exception of China. Consumer credit lending showed a strong CAGR in personal loans, again only trailing the Chinese market. However, growth across credit cards was weaker as economic activity decreased due to the pandemic. The Hong Kong market has witnessed a triple threat over the last few years. Its economy entered a recession in 2017 as geopolitical forces such as the US-China trade war had effects on the territory. Domestic political instability compounded this uncertainty, and COVID-19 became the metaphorical cherry on top in 2020. The retail, tourism, hospitality, and transport sectors were all negatively impacted by the global decrease in travel as well as by regional travel bans and nationwide lockdowns. Overall, Hong Kong as a territory and a financial center has fared better during the pandemic than other markets – but a recent surge in cases has had significant effects on growth and recovery.
This report explores the key trends in the Hong Kong retail banking sector and offers insight into consumer preferences and changes in behavior regarding financial services providers. It also examines channel preferences and covers overall satisfaction and importance levels of the main banking attributes. In addition, the report analyzes cross-selling opportunities by looking at customer tenures and areas of dissatisfaction.
– There has been a 17 percentage point decline in preference for transaction/savings accounts from traditional providers in Hong Kong. However, alternative providers such as digital banks have not taken advantage of this shift.
– Use of digital channels in Hong Kong has historically been high but has accelerated in the past 18 months due to COVID-19. As a result, for almost all banks in Hong Kong, branch usage has fallen compared to pre-pandemic levels.
– The most opportune moment to cross-sell to consumers in Hong Kong is when they have been customers for five or more years. Before this point rates of cross-selling are low.
Reasons to Buy
– Understand and analyze Hong Kong’s mortgage, deposit, and lending market trends based on present and forecast growth up to 2025.
– Analyze data from our 2021 Financial Services Consumer Survey by looking at new consumer preferences and behaviors in the Hong Kong retail banking market.
– Identify critical data points for customer retention and future customer acquisition through three core areas in banking: financial services provider preference and movements, digital and alternative channel preferences, and cross-selling opportunities based on tenure and satisfaction levels.
Bank of China
Hang Seng Bank
Bank of Communications
OCBC Wing Hang Bank
AEON Credit Services
Table of Contents
Table of Contents
1. Executive Summary
1.1 Positive CAGR growth is expected across all product areas, although consumer credit growth is slowing
1.2 The preference for services from incumbents has decreased, and Hong Kong banks needs to deliver competitive prices
2. Key Facts: Hong Kong
3. Market Environment
3.1 Residential mortgages
3.2 Retail deposits
3.3 Credit cards
3.4 Personal loans
4. Macroeconomic Environment
4.1 GDP and unemployment
5. Competitor Environment
5.1 Retail deposits
5.2 Residential mortgages
5.3 Credit cards
5.4 Personal loans
5.5 COVID-19 has increased costs for leading incumbents in Hong Kong and across the region
6. Hong Kong Survey Insights
6.1 Preferences are beginning to shift away from incumbents towards digital wallet providers
6.2 Banks in Hong Kong have prioritized the attributes of service that customers rank as most important
6.3 Banks need to prioritize perfecting the basic user experience
6.4 Banks in Hong Kong can increase revenues by offering digital mortgage applications
6.5 Cross-selling is correlated with high rates of customer satisfaction and tenures of five years and above
6.6 The longer the tenure, the better the opportunity to cross-sell products
7.1 Mox Bank
7.2 ZA Bank
7.3 Airstar Bank
8.1 Abbreviations and acronyms
8.3 Further reading
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