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Nova Credit Announces Estimated Bankruptcy Rate at 0.153% for 2023 Q3

Inbound tourism and private consumption continue to drive economic growth

NOVA announces the latest estimated bankruptcy rate for the next 12 months at 0.153%, which is equivalent to 8,568 bankruptcy cases by the end of August 2024 for 5.6 million credit population in Hong Kong.

This estimated bankruptcy rate calculation is based on to the latest macro-economic data (as of 4th September 2023) and the unemployment rate (provisional figures). According to the statistics released by the Census and Statistics Department, the year-on-year percentage change of GDP as of 2023 Q2 is +1.5%,  and the quarter-to-quarter percentage change of GDP as of 2023 Q2 is -2.9%, which imposes a negative impact on the predicted bankruptcy rate. The unemployment rate decreased from 3.0% in April 2023 to 2.8% in July 2023, positively impacting on the predicted bankruptcy rate.

Government Economist Adolph Leung predicts that inbound tourism and private consumption will remain the major drivers of economic growth for the rest of the year. As transportation and handling capacity continue to recover, visitor arrivals should increase further. The improving economic situation and prospects should bode well for domestic demand, though tight financial conditions may impose constraints.

NOVA will continuously observe the macro-economic environment and its impact on the number of bankruptcy cases accordingly, and leverage innovative technology to share valuable insights with the banking sector for making more accurate and timely business decisions.