On the last day of 2020, the Central Bank of the Communist Party of China (CPC) and the CBRC jointly issued new regulations that set a cap on real estate loans to Chinese banks. It is widely believed that the new rules will have a greater impact on banks with a high proportion of real estate loans, and bank stocks generally fell on January 4, the first trading day of Chinese A-shares in 2021.
On December 31, 2020, the CPC Central Bank and the CBRC issued the Notice on the Establishment of a Concentration Management System for Real Estate Loans of Banking Financial Institutions, which divided all banks into five classes and set two indicator ceilings for real estate loans and the percentage of personal housing loans, respectively. Among them, the six state-owned banks and China Development Bank are the first class, with two caps of 40% and 32.5% respectively, the highest among the five classes.
The new regulations show that the two ratios of banks shall not be higher than the upper limit set by the regulator, and for banks that do not meet the requirements, the regulator has set a transition period. It is widely believed that the new regulations will have a greater impact on banks with a high percentage of real estate loans.
On January 4, the first trading day of 2021, the Shanghai Stock Exchange Index rose 0.85% to recover the 3,500-point mark, but bank stocks fell 1.93% overall, leading the decline in the entire A-share market.
Specifically, real estate loans accounted for a larger percentage of the banks generally fell, Chengdu Bank fell 8.06%, Industrial Bank, Bank of Zhengzhou, Bank of Qingdao fell 5.85%, 4.48%, 4.05%, respectively.
Land media “interface news” reported on January 4, a joint-stock bank branch vice president said that the bank branch real estate loans have now exceeded the ceiling, personal mortgage loan loans have accounted for more than 50% of the new rules on their impact is great, can only be part of the mortgage loans to asset securitization transfer out.
Soochow Securities issued a research report, said that from the results, medium and large banks are more obviously affected by the policy. If measured based on the data from the 2020 interim report, 10 listed banks exceeded the target for housing loans and 11 exceeded the target for real estate loans.
From Huatai Finance collated relevant data, the first file, construction banks and Postbank’s personal housing loans accounted for slightly more than 32.5% of the red line, business adjustment transition period are bit 2 years. Four banks in the second file “exceeded”, respectively, China Merchants Bank, Industrial Bank, Pudong Development Bank and Ping An Bank, of which China Merchants Bank and Industrial Bank’s transition period of four years, the other two for two years. In the fourth gear, there are also four banks “exceeded”, respectively, Bank of Chengdu, Bank of Zhengzhou, Bank of Qingdao and Qingnong Commercial Bank, the transition period are four years.
Recent Comments