Property loan growth down in 2011

 

Turning to property now, and China's market has been hit by an array of policy measures to rein in climbing prices. Last year, Chinese banks extended a total of 1.26 trillion yuan, or nearly 200 billion US dollars, to property developers and buyers. That's down 38 percent from 2010, and makes up just 17 and a half percent of total new loans issued last year, compared with nearly 27 percent the year before.

Property loans include loans to property developers, property buyers and equity loans.

The slower growth comes as the Chinese government has tightened monetary policy and put restrictions in place to cool the overheated residential market. Measures have included raising mortgage rates and minimum down payments, to ease public discontent with rocketing home prices. These measures had made it difficult for both home buyers and developers to get bank loans.

However, loans extended for the construction of affordable homes grew. They amounted to nearly 350 billion yuan at the end of 2011, with new loan growth for this sector hitting 175.1 billion yuan.

Through the end of 2011, total outstanding loans granted to the real estate sector increased 17 percent from a year earlier to 2.72 trillion yuan at the end of December compared with a rise of 23 percent at the end of 2010.

The central bank also said that the mid-to-long term loans to manufacturing and service industries also grew at a slower pace last year, with new lending to manufacturers falling 35 percent from a year ago to just over 517 billion yuan.

New short term loans and bill financing reached 3.11 trillion yuan in 2011, surging from 0.81 trillion yuan in 2010, while mid-to-long term loans to companies slowed. Loans to SMEs increased steadily.