China’s banking regulator is moving to deal with growing financial risks stemming from the country’s plummeting housing market and a number of small banks embroiled in a liquidity crisis.
China’s Banking and Insurance Regulatory Commission said in a statement posted on its website on Monday that it would ask banks to provide the credit that qualified real estate developers need to complete unfinished residential projects.
It will also study a plan to fill future funding gaps for these projects.
The commission said it will work with local governments and other regulators to secure the delivery of homes after homeowners in several provinces said they would suspend mortgage payments on overdue homes.
Home deliveries were recently delayed amid growing funding gaps faced by many property developers in China.
In the same statement, the regulator said it is working with other government bodies to address risks associated with five small rural banks in China’s Henan and Anhui provinces.
Bank customers have been blocked from accessing their savings since April.
After a three-month investigation, Henan New Wealth Group was found to have manipulated the five banks and used third-party platforms and fund brokers to collect public savings, the commission said.
It also denied that the refunds given last week were due to a protest mounted by depositors.
Source: CNN Brasil
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