In the first half of the year, the unaudited comprehensive profit after tax of Hong Kong mortgage securities companies was 53.3 million Hong Kong dollars.

On September 26, Hong Kong Mortgage Securities Limited (Mortgage Securities Company) announced its mid-term performance for 2025. The financial summary shows that the unaudited comprehensive after-tax profit for the first half of 2025 was HK$53.3 million (compared to HK$9 million for the first half of 2024). The increase in profit was mainly due to the increase in returns on foreign fund deposits; the rapid growth of the elderly mortgage business in the first half of 2025 decreased compared to the negative impact of property price changes in the same period in 2024; the increase in foreign exchange gains from cash and debt investments held under favorable market conditions; and an increase in net interest income. Some of the profits were offset by an increase in accounting losses from the insurance performance of the annuity business, reflecting an increase in new policy numbers driven by the overflow effects of the annuities introduced in 2024 and discount activities. For a better evaluation of financial performance, adjusted after-tax profits, annualized return on equity, and cost-to-income ratio for the first half of 2025 were HK$874 million, 6.2%, and 14.2% respectively after excluding the impact of comprehensive financial accounting adjustments made for the full subsidiary of the Mortgage Securities Company that engages in annuity business - Hong Kong Annuity Limited, the impact of long-term elderly mortgage business nature affected by property price changes, and the impact of comprehensive financial accounting adjustments made for the loan portfolio provided by another full subsidiary of the Mortgage Securities Company that engages in general insurance business - Hong Kong Insurance Limited. For the first half of 2024, these figures were HK$468 million, 6.2%, and 22.4%. As of June 30, 2025, the implicit value of the annuity business calculated under the Insurance Business Ordinance (Chapter 41) was approximately HK$21.6 billion, including equity of HK$18.5 billion and the present value of future profits of HK$3.1 billion, reflecting the strong financial position of Hong Kong Annuity Limited to support the long-term development of the annuity business. According to the capital adequacy ratio guidance, the capital adequacy ratio calculation follows the comprehensive financial reporting framework and excludes regulated subsidiaries that are subject to other ongoing capital requirements (namely Hong Kong Annuity Limited and Hong Kong Insurance Limited regulated by the Insurance Authority). Excluding the investment cost of unconsolidated regulated subsidiaries, the capital adequacy ratio of the Mortgage Securities Company was still at a robust level of 18.7% on June 30, 2025 (19.9% on December 31, 2024), far above the minimum requirement of 8% set by the Financial Secretary. Based on the solvency adequacy ratio calculated under the Risk-Based Capital Regime of the Insurance (Valuation and Capital) Rules Chapter 41R, the solvency adequacy ratios for Hong Kong Annuity Limited and Hong Kong Insurance Limited were approximately 2.2 times (1.7 times on December 31, 2024) and 3.7 times (4 times on December 31, 2024) respectively on June 30, 2025, well above the statutory minimum requirement set by the Insurance Authority. In light of the uncertain market environment, the Mortgage Securities Company has adopted a cautious strategy to pre-finance and actively communicate with the local and international investment community regarding bond issuances to support large loan purchases and meet refinancing needs. Building on strong financing capabilities and liquidity levels, the core business of the Mortgage Securities Company remains flexible and stable, making adequate preparations to address financial volatility, fulfill its strategic policy role and achieve social objectives.