Central Bank and Two Government Agencies Extend Monetary Policies to Support Real Estate Companies
Xinhua News Agency, Beijing, July 10th
The central bank and two other government departments have announced the extension of two monetary policies aimed at providing continuous and stable support to real estate companies. The People’s Bank of China and the State Administration of Financial Supervision issued a notice on July 10th, adjusting previously announced monetary policies to encourage the stable and healthy development of the real estate market. The relevant period for these policies has been extended to December 31, 2024.
In an interview, a spokesperson from the People’s Bank of China explained that the objective of this move is to guide financial institutions in continuing to provide stock financing to real estate companies and increasing financial support for guaranteed distribution buildings. These measures are intended to promote the stability and growth of the real estate market.
In November 2022, the People’s Bank of China and the former China Banking and Insurance Regulatory Commission jointly introduced 16 financial measures to support the real estate market. These measures aimed to maintain the stability and order of real estate financing, provide financial services for guaranteed buildings, manage risks associated with distressed real estate enterprises, and increase financial support for housing leasing. The implementation of these policies has yielded positive results in maintaining reasonable and moderate real estate finance and addressing risks faced by real estate companies.
As part of the extended policies, there are two key aspects. Firstly, there is support for the extension of stock financing, such as development loans and trust loans. Secondly, financial institutions are encouraged to provide additional financial support for guaranteed supply buildings.
Prior to the policy extension, the original regulations stated that financing expiring within the following six months from the publication date of the notice could be extended for one year. However, with this adjustment, financing that expires before December 31, 2024 can now be extended beyond the original regulations. This extension not only provides a favorable financing environment for the real estate industry but also helps financial institutions resolve existing loan risks.
Furthermore, the extension also applies to the Guaranteed Construction Loan Support Scheme, which was originally set to expire on March 31, 2023. Its implementation will now continue.
Industry insiders believe that this extension will alleviate concerns among financial institutions regarding ancillary financing by real estate companies. It will create a more accommodating financing environment for real estate companies and promote continued and stable financial support from financial institutions.
In response to the financing challenges faced by real estate companies, the financial management department has introduced a series of measures this year. These measures focus on both stock and incremental growth, providing financing support through various channels, such as loans, bonds, and asset management. The objective is to maintain a stable and high-quality financing cash flow for real estate companies and support their transition to new development models.
Recently, during the Monetary Policy Committee meeting in the second quarter of 2023, the People’s Bank of China proposed policies to support housing demand and ensure housing supply stability. These policies aim to promote the stable and healthy development of the real estate market, accelerate the improvement of housing leasing financial policies, and establish a new model for the industry’s development.
The spokesperson from the People’s Bank of China emphasized the importance of financial institutions implementing these policies seriously. They need to support the housing needs of the population, maintain reasonable and moderate real estate financing, increase financial support for guaranteed buildings, and effectively manage industry risks. These actions will contribute to the stable and healthy development of the real estate market.
Xinhua News Agency, Beijing, July 10th Question: The central bank and two other departments extended two monetary policies to provide continuous and stable support to real estate companies
Xinhua News Agency Correspondent Wu Yu
The People’s Bank of China and the State Administration of Financial Supervision issued a notice on the 10th to adjust the two previously announced monetary policies to support the stable and healthy development of the real estate market, and extend the relevant period to December 31, 2024. The said a relevant person in charge of the People’s Bank of China that the aim of this move is to lead financial institutions to continue to extend real estate company stock financing and increase financial support for guaranteed distribution buildings.
In order to promote the stable and healthy development of the real estate market, the People’s Bank of China and the former China Banking and Insurance Regulatory Commission jointly launched 16 financial measures in November 2022, starting from maintaining the stability and order of real estate financing, embarking on providing financial services for the provision of guaranteed buildings, and collaborating with distressed real estate enterprises In terms of risk management and increasing financial support for housing leasing, support policies have been clarified.
According to the relevant person in charge of the People’s Bank of China, after the “Sixteen Financial Measures” were published and implemented, they played a positive role in maintaining reasonable and moderate real estate finance and promoting solving real estate enterprise risks, and achieving good policy outcomes. “Considering the current situation of the real estate market comprehensively, in order to guide financial institutions to continue extending real estate company stock funding and increasing financial support for guaranteed supply buildings, the financial management department has extended the relevant period of relevant policies .”
The reporter found that the extension policy is centered in two aspects, On the one hand, it is a policy to support a reasonable extension to stock financing such as development loans and trust loans, and on the other hand, it is a policy to encourage financial institutions to provide ancillary financial support for guaranteed supply buildings.
In terms of extending the current funding, the original policy states “from the date of publication of this notice, if it expires within the next six months, an extension of one year beyond the original regulations may be granted .” After this policy modification, “those expiring before December 31, 2024 can be extended for one year beyond the original regulations.” The financing environment of the real estate industry. At the same time, this is also favorable for financial institutions to resolve the risk of existing loans.
In addition, the original policy states that “within half a year from the date of publication of this notice, the supporting funding given to the special loan assistance project will not be reduced during the loan period; subject to the loan after the old and new debts.separated are managed as a qualified lender.If the newly issued matching finance is poorly formed and the relevant institutions and personnel have done their due diligence, they may be exempt from liability.” After this adjustment, the applicable period is also extended to before December 31, 2024.
Industry insiders said this extension will help dispel some of the concerns of financial institutions about the new ancillary financing issued by real estate companies, provide a relatively relaxed financing environment for real estate companies, and help guide financial institutions to provide continued financial support. and stable. for real estate companies.
In addition, the reporter also learned from the People’s Bank of China that the Guaranteed Construction Loan Support Scheme, which was scheduled to expire on March 31, 2023, has been confirmed to continue its implementation.
Industry insiders said that since the beginning of this year, the financial management department has introduced a series of measures to tackle the financing problems of real estate companies, starting from stock and incremental growth, increasing financing support through multiple channels such as loans, bonds, and asset management, and maintaining high-quality financing cash flow for real estate companies Stability will help guide the balance sheet of high-quality real estate companies to return to a safe range, and promote the industry’s smooth transition to a new development model .
Recently, the Monetary Policy Committee of the People’s Bank of China held a regular meeting in the second quarter of 2023, proposing that policies should be implemented to support rigid and better demand for housing, and do a solid job in ensuring housing supply, people’s livelihood, and stability, in order to promote the stable and healthy development of the real estate market, Accelerate the improvement of the housing leasing financial policy system, and promote the establishment of a new model for the development of the real estate industry.
The relevant person in charge of the People’s Bank of China said that all financial institutions should seriously implement the requirements, implement policies according to the city to support the needs of rigid and better housing, maintain reasonable and moderate real estate financing, increase financial support for achieving guaranteed. buildings, and promote the marketing of industry risks Promote the stable and healthy development of the real estate market.
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