The Industrial and Commercial Bank of China (ICBC) said on Monday it would apply stricter approval rules to property lending this year as part of an effort to balance its loan structure and stem rising credit risks.
The world’s largest bank by market capitalization will not issue new loans to developers who seek to speculate on rising property prices through "hoarding land" or "putting off home sales" and may also call back earlier credit to such borrowers, the lender said at its 2010 work conference.(…)
"Every Chinese bank has set an upper limit for lending to the real estate sector in recent years, but the limit will be lowered this year as lenders become more prudent and selective in offering loans to developers," said Fu Lichun, a banking analyst at Southwest Securities. Property loans usually account for one fifth of banks’ total new lending annually.(…)
Banking regulators aimed to limit new loans to 7.5 trillion yuan this year, 25 percent less than the nearly 10 trillion yuan banks gave out last year. As a result, banks are being urged to advance loans at a reasonable pace and avoid front-loaded and excessive loans at the beginning of the year.(…)
The Beijing-based lender advanced some 110 billion yuan in new loans in January, a significant slowdown from the amount it issued a year ago.
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