A-share Banks Post Surge in Mortgage Lending


A cohort of over a dozen of China’s A-share banks saw mortgage lending leap by nearly 50% on average last year.

13 of China’s listed A-share banks made a total of 12 trillion yuan in mortgage loans in 2016, for a year-on-year increase of 33%, and an average increase 46%.

Some of the banks posted increases in mortgage lending of more than 50%, while most of major state-owned banks saw heavy gains.

Industrial and Commercial Bank of China (ICBC), China Construction Bank (CCB), Agricultural Bank of China (ABC) and Bank of Communications (BoCom) all increase their mortgage lending by around 30 per cent.

Only Jiangsu Jiangyin Commercial Bank saw a decrease in personal real estate lending, with loans in this area plunging 31%  last year.

Low interest rates and loose monetary policies gave a boost to property prices in China’s first and second-tier cities last year, providing strong impetus to mortgage lending.

Chinese mortgage lending is unlikely flourish in 2017, however, with the government already introducing policies to cool the property market.

The People’s Bank of China (PBC) recently issued its “Opinions on Properly Performing Loan Policy Work” (做好信贷政策工作的意见), requiring that residential property policies be made a part of overall policies for controlling the property market.

Chinese banks are also making adjustments to down payment ratios, loan interest rates, housing loan volumes and examination and approval times in response to a raft of real-estate policies released by local governments.