FILE PHOTO: FILE PHOTO: A worker speaking on his phone walks past a construction site in Beijing, China April 14, 2022. Picture taken April 14, 2022. REUTERS/Tingshu Wang/File Photo/File Photo
BEIJING: China's financial institutions should actively fulfill reasonable financing demands for property projects, an official at the National Financial Regulatory Administration (NFRA) said on Thursday.
Financial institutions should not blindly withdraw and cut off loans for eligible property projects that have encountered temporary difficulties on construction, Xiao Yuanqi, deputy director of the NFRA, said at a news conference.
The sustained downturn in the real estate sector that accounts for around a quarter of China's economy could drag on the country's broader recovery and heap pressure on policymakers to roll out fresh support.
Local governments and housing authorities are also encouraged to further optimize policies on down payment ratio and mortgage rates, to better serve financing needs of residents on property purchases, Xiao said.
The outstanding value of real estate development loans is about 12.3 trillion yuan ($1.72 trillion), with mortgage loans at about 38.3 trillion yuan, he said.
Xiao also vowed that China will continue to strictly supervise high risk small- and medium-sized banks to defuse financial risks.
Non-performing loans (NPLs) at banking and financial institutions were 3.95 trillion yuan ($551.08 billion) at the end of 2023, with the NPL ratio at 1.62%, Liu Zhiqing, director of the regulator's statistics and risk monitoring department said.
Net profits of commercial banks rose 3.2% last year, Liu said. - Reuters
