HSBC raises Hong Kong mortgage rates by up to 75 bps

HSBC confirmed on Tuesday it had increased mortgage rates by between 50 and 75 basis points. After the increase, new mortgage customers will face interest rates of between 3.5 percent and 4 percent.

HSBC is taking the lead in raising mortgage rates as Hong Kong banks will have to cut their best rates in line with the Fed, as otherwise they will not be making any profit,'' a spokeswoman from HSBC said.

"Other Hong Kong banks will follow HSBC because they all face the same problem," she said.

Shares of HSBC dropped 5.27 percent to HK$79.950 at 4:10 p.m.