Source: Finance Association
① Institutions such as China Construction Bank, Agricultural Bank, Bank of Communications, and Zheshang Bank have intensively held housing enterprise symposiums. Recently, many major financial institutions have held discussions with non-state real estate companies such as Country Garden, Longhu, and Greentown ② Resolve the real estate capital chain issues. In addition to the bank's perspective, it is also necessary to enable the sales side to steadily recover.
Recently, China Construction Bank, Agricultural Bank, Bank of Communications, Zheshang Bank and other institutions have actively implemented the spirit of the symposium between the People's Bank of China, the State Administration of Financial Supervision, and the China Securities Regulatory Commission and financial institutions, and have held intensive housing enterprise symposiums. According to a reporter from the Financial Association, a number of major financial institutions have recently held discussions with non-state real estate enterprises such as Country Garden, Longhu, and Greentown to strengthen communication, speed up the resolution of their reasonable demands, and improve the financing environment for housing enterprises.
At the symposium, the bank side stated that it will implement the relevant spirit as soon as possible, and mentioned the matching of the project sales cycle with financial support, loan replacement, and withdrawal of pre-sale funds under bank guarantees. The industry said that the meetings of the three ministries and commissions and the start of separate contacts with real estate companies by various major banks could change the market's concerns about real estate risks, but experts also said that in addition to blood transfusions from outside banks, the improvement in real estate sales is also the key.
Many banks have implemented the spirit of the three ministries
Recently, a number of banks, including China Construction Bank, Agricultural Bank, and Bank of Communications, etc., convened a symposium for housing enterprises. On the afternoon of November 27, Bank of Communications held a symposium with 15 housing enterprises, including Vanke Group, Greentown China, and Longhu Group; on November 24, China Construction Bank convened 6 housing enterprises, including Vanke, Longhu, Midea Real Estate, Xincheng Development, Binjiang Group, and Dahua Group, to hold a symposium to listen to various financing needs.
Earlier, on November 21 and 22, the Agricultural Bank held separate business discussions with executives from companies such as Vanke Group, Longhu Group, and Zhu Mengyi Family Group. Zheshang Bank also held a symposium with more than 20 representative real estate companies from inside and outside the province on November 22.
According to reports, a number of major financial institutions have recently held discussions with non-state real estate enterprises such as Vanke, Country Garden, Longhu, and Greentown to strengthen communication, speed up the resolution of their reasonable demands, and improve the financing environment for housing enterprises.
In terms of research content, banks mainly focus on the spirit of the symposium between the People's Bank of China, the China Securities Regulatory Commission, and financial institutions, and conducted in-depth research on the financing needs of housing enterprises, including underwriting and investment, operating property loans, bank credit increases, and overseas and cross-border financing.
According to a reporter from the Financial Association News Agency, at these meetings, banks stated that they would implement the relevant spirit as soon as possible, and mentioned things such as supporting the reasonable financing needs of housing enterprises, matching project sales cycles with financial support, loan exchanges, and withdrawing pre-sale funds under bank guarantees.
“This kind of content has more new meaning than our traditional understanding of increasing the size of loans. It explains not only the demands of housing enterprises, but also the subsequent momentum. And objectively, these meetings have also created a better foundation for the precise implementation of policies in the future.” Yan Yuejin, research director of the Yiju Research Institute, told a reporter from the Financial Association.
It is worth noting that banks are actively implementing the spirit of the meeting of the three ministries and commissions, and have attached great importance to this round of research. Zheshang Bank said it will actively cooperate with industry authorities and local governments to implement comprehensive policies on both supply and demand sides of the real estate market, maintain the stability of financing channels such as credit and bonds, and actively carry out “building security” work. The Bank of Communications proposed using a three-tier and two-tier “3+2” mechanism to provide financial support services to public sector housing enterprises, and improve cooperation in the field of retail credit around the housing scenario.
Li Yujia, chief researcher at the Guangdong Housing Policy Research Center, said that these bank-led meetings and connections with housing enterprises can change the logic of market concerns about risk.
“The meeting of the three ministries and commissions and various major banks have begun to connect with real estate companies separately. In particular, a host banking system has recently been proposed. Existing leading banks collaborate with other banks to promote loan issuance, thus changing the logic of collective risk concerns and stabilizing reasonable cash flow in the market.” Li Yujia said.
Housing enterprises need to resume their own blood supply
According to a reporter from the Financial Association, real estate companies such as Vanke Group, Longhu Group, Greentown Group, Midea Real Estate, and Xincheng Development were invited by various banks to participate in the symposium.
According to Yan Yuejin, according to Yan Yuejin, including Vanke, Greentown, Longhu, Midea Real Estate, Binjiang Group, Dahua Group, Renheng Land, New Hope Real Estate, Excellent Real Estate, Xincheng Holdings, Weixing Group, Lujiazui Group, Pudong Development Group, and more than 10 similar housing enterprises with initial shares can be viewed as systemically important housing enterprises.
“Relevant housing enterprises should also take the initiative and do a good job in sales in the fourth quarter to increase the possibility of bank-enterprise cooperation. In particular, some private housing enterprises, currently using the central bank's 8 departments and 25 private economy support policies, should take the initiative to do a good job and actively seize new opportunities for development.” Yan Yuejin said.
Currently, the market is still waiting to see the results of intensive symposiums between banks and housing enterprises. At the end of the day, there is still a need for real estate sales to pick up. Otherwise, even if banks support housing enterprises with reasonable financing, the results that can be achieved will be quite limited.
Zhang Dawei, chief analyst at Zhongyuan Real Estate, pointed out, “The current real estate problem is not just a financing issue. If real estate sales do not improve, the role banks can play in summoning housing enterprises for meetings may be limited.”
Li Yujia also said that no matter how financial institutions do blood transfusions, at the end of the day, housing enterprises still need to restore their own hematopoietic function. “Since real estate is a capital-heavy industry and a highly leveraged industry, the main source of capital is repayment from one's own sales, that is, restoration of hematopoietic function. Therefore, to solve the real estate capital chain problem, in addition to the bank's perspective, it is also necessary to enable the sales side to steadily recover.” Li Yujia pointed out.