Property

China c. bank discusses asset disposals by property firms, sources say

People wearing face masks walk past the headquarters of Chinese central bank People’s Bank of China (PBOC), April 4, 2020. REUTERS/Tingshu Wang

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HONG KONG/BEIJING, April 25 (Reuters) – China’s central bank met banks last week to discuss the disposal of non-performing assets by property developers, four sources with knowledge of the matter said, as regulators seek to shore up the real estate industry which has been knocked by defaults.

A dozen of cash-strapped property firms, including China Evergrande Group (3333.HK) and Kaisa Group (1638.HK), were invited to the meeting on Tuesday, two of the sources said.

The People’s Bank of China (PBOC) encouraged commercial banks at the meeting to offer new loans and extend existing loans to developers, the sources said.

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Five national asset management companies were also present at the meeting, the sources added.

China Securities Journal first reported the meeting, saying the developers which attended included Zhongliang Holdings (2772.HK) and Yango Group (000671.SZ).

Kaisa declined to comment. PBOC, Evergrande, Zhongliang and Yango did not respond to requests for comment.

Beijing has signalled there would be more government support for the embattled sector after bond payment defaults by Evergrande and other property developers rattled global markets.

But China’s pledges to shore up the industry have done little to boost prospects, developers have said, as they struggle to access funding and many local government authorities remain reluctant to ease development rules. read more

Two developers which attended Tuesday’s meetings said on Monday they were not very optimistic about prospects for securing more financing from banks.

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Reporting by Clare Jim in Hong Kong and Shuyan Wang in Beijing; Editing by Edmund Blair

Our Standards: The Thomson Reuters Trust Principles.

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