Hong Kong personal bankruptcies up 186%
Some idea of the impact the current recession in the Far East is having on personal spending is provided by the fact that personal bankruptcies and credit card write-offs by banks are now at an all time high.
According to the latest figures from the Hong Kong Monetary Authority, 12,407 bankruptcy orders were issued during the first six months of the year – an increase of 186% on the year before and 35% more than 2001’s full year figure of 9,151, which was itself record-high.
During the second quarter alone, banks lost $2.06 billion on credit cards compared with the previous record of $1.36 billion in the first quarter. Last month was the third in succession with more than 2,000 bankruptcies, with 2,243 orders made. Rising unemployment and the poor state of the economy are the main reasons cited by the authority.
To counter the problem, the Hong Kong government, banking sector and privacy commissioner have begun work on a so-called "positive credit information" bureau that will enable banks to share credit information about clients who have no default records.
