BOCHK capitalisation strong but property risks remain

Fee income and treasury income will support its profitability through mid-2027.

Bank of China Hong Kong (BOCHK) has improved its capitalisation and profitability, although risks persists from property sector exposures.

The bank is expected to maintain a good financial profile over the next 12-18 months. Profitability will be supported by fee income and treasury income, Moody’s Ratings said in a commentary published on 15 January 2026.

Asset quality will remain “sound and stable” over this period, with Moody’s saying that it has “good loan underwriting.”

However, tail risk to asset quality persists, stemming from BOCHK’s exposure to the real estate sectors of Hong Kong and mainland China.

On the other hand, BOCHK’s borrowers are mainly large companies, which usually have sound financial profiles and low balance sheet leverage, Moody’s said.

“The bank's low funding costs, good operating efficiency, and low credit costs contribute to its good profitability,” Moody’s wrote.

The bank is also expected to maintain strong capitalisation on the back of its good profitability; and good funding and strong liquidity, supported by its “extensive deposit-gathering capabilities through a wide branch network.”