CCB, BOC and China Everbright among Chinese lenders that have injected billions into ‘whitelist’ housing projects

Leading Chinese banks have injected billions of yuan into housing projects with the aim of financing the completion of pre-sold but yet-to-be-completed homes across the country, according to figures released by the lenders.

China Construction Bank (CCB), one of the largest state-owned commercial banks in the country, has handled more than 2,000 projects under the mechanism and approved nearly a hundred with pending disbursements of more than 20 billion yuan (US$2.78 billion), the bank said on Tuesday.

“Recently, the Beijing, Fujian, Anhui and Henan branches of CCB have realised the placement of five projects with an amount of nearly 3 billion yuan,” the bank said in a social media post.

The whitelists, launched by the housing ministry at the start of the year, ask provincial governments to recommend to banks local residential projects that are deemed financially sound and fit for further loan support. The whitelist screening criteria are based on projects instead of developers themselves.

Authorities have been urging provincial governments and banks to increase funding to struggling property developers, following the sharpest decline in nearly nine years in new home prices recorded in December.

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As of the end of January, the local governments of 170 cities had put forward 3,218 real estate projects for consideration under the whitelist mechanism, according to official figures.

Bank of China (BOC) reported on Monday that it had advanced the reviews of more than 110 projects totalling 55 billion yuan. Among them, 75 with a total amount of nearly 40 billion yuan had been approved.

“Next, BOC will continue to fulfil its responsibilities as a major state-owned bank,” it said in a WeChat post. “It will treat all enterprises, regardless of ownership, equally to meet their reasonable financing needs.”

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Agricultural Bank of China, another state-owned commercial bank, said on Sunday that it had approved nearly 10 new projects with loans totalling nearly 5 billion yuan, after handling more than 2,700 projects under the whitelists mechanism.

Similarly, Industrial and Commercial Bank of China had also handled more than 2,000 projects as of Thursday, according to an official announcement.

In addition to the “Big Four” state-owned banks, commercial banks such as China Everbright Bank and China Citic Bank have also disclosed recent progress in response to the regulatory call.

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As of Wednesday, 29 branches of China Everbright Bank had approved 20 whitelist projects with a credit amount of 10.75 billion yuan, the bank said on Thursday.

“Next, the bank will continue to fulfil its mission as a centrally managed financial enterprise, firmly carrying out its financial service functions and accurately focusing on the reasonable financing needs of real estate enterprises.”

While a recovery in China’s property sector remains “elusive”, the fastest pace of declines in sales and new project starts might have passed, US investment bank Goldman Sachs said in a report last week.

“With further policy support, we expect the China property sector to be on an ‘L-shaped’ path.”