China’s Big Six State-owned Banks Step up Support for Real Estate Sector, Sign Agreements with Major Developers

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All six of China’s big state-owned banks have stepped up efforts to provide financial support to nationwide companies in the country’s recently beleaguered property sector.

During the period from 23 to 24 November the big six Chinese banks signed a slew of strategic cooperative agreements with China’s leading real estate enterprises, to provide them with loans and other forms of financial support.

On 23 November, Agricultural Bank of China (ABC) entered strategic cooperative agreements with five real estate enterprises, including China Shipping Development, China Resources Land, Vanke Group, Longfor Properties and Gemdale Group.

Bank of China (BOC) entered a strategic cooperative agreement with Vanke Group to provide up to 100 billion yuan in financing, while Bank of Communications (BOCOM) signed a comprehensive strategic cooperative agreement with Vanke Group and Midea Real Estate.

The following day on 24 November, Industrial and Commercial Bank of China (ICBC) entered a strategic cooperative agreement with 12 nationwide real estate enterprises to provide up to 655 billion yuan in financing. These enterprises included Vanke Group, Gemdale Group, Greentown China, Longfor Properties, Country Garden Group, Midea Real Estate and Radiance Group.

On the same day, China Construction Bank (CCB) convened a forum on the outlook for the real estate sector and rental housing funds, where it signed cooperative agreements with eight real estate enterprises including Beijing Capital Group, Yuexiu Group, Vanke Group, Longfor Real Estate, Midea Real Estate, Hopson Development and Dahua Group.

Postal Savings Bank of China (PSBC) has executed strategic cooperative agreements with real estate companies including Vanke Group, Longfor Real Estate, Greentown China, Country Garden Group, Midea Real Estate to provide up to 280 billion yuan in financing.

The Agreements provide variable forms of support. ICBC’s cooperative arrangements cover real estate development loans, personal home mortgages, financing for real estate project takeovers, financing for rental housing, exchanges of letters of guarantee for pre-sale regulatory funds and bond underwriting and investment.

ABC said that its cooperation with real estate developers would involve deeper collaboration on real estate development loans, personal home mortgages, project acquisition loans and bond underwriting and investment, with a focus on the key areas of commercial housing, welfare housing and urban renewal.