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China property
BusinessBanking & Finance

Chinese banks pledge billions in credit support to help struggling developers after Beijing confirms rescue plan

  • The PBOC and the CBIRC officially confirmed a 16-point rescue plan for China’s real estate sector on Wednesday
  • Major Chinese banks have announced financing support for a slew of developers, with more lenders set to follow to align with the official policy

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A Vanke sign is at a residential construction site in Dalian, Liaoning province. Chinese banks have offered credit support for struggling developers such as Vanke to revive the stricken property sector. Photo: Reuters
Iris Ouyang

Chinese banks and authorities are ramping up aid to ease private developers’ liquidity woes following the official release of Beijing’s rescue plan for the sector.

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Stocks of Chinese developers jumped on the news as banks rushed to provide credit lines to several struggling home builders.

A Bank of China representative said the bank is expected to offer support to more developers, without providing details, after the lender on Wednesday signed an agreement with China Vanke, the nation’s third-biggest property developer by sales, offering a credit line worth up to 100 billion yuan (US$14 billion).

Country Garden, the nation’s biggest home seller, told the Post on Thursday that it had signed a long-term strategic partnership with the Postal Savings Bank of China (PSBC).

Postal Savings Bank of China said it would offer a loan quota of up to 50 billion yuan to Country Garden. Photo: AFP
Postal Savings Bank of China said it would offer a loan quota of up to 50 billion yuan to Country Garden. Photo: AFP

“The PSBC will provide Country Garden with an intentional loan quota of up to 50 billion yuan to be used for development, mergers and acquisitions, guarantees, factoring in bond financing and other forms of financing facilitation,” the Foshan-based developer said in a statement. The loans could also be used for mortgage lending to consumers who buy houses from Country Garden or its affiliated firms.

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