S&P believes that the domestic real estate market has been in a serious slump since the second half of 2021, and is still looking for a bottom. Although the industry's external financing conditions are challenging, China Overseas (00688.HK) has a well-functioning financing channel, mainly due to the special support from the central government to its parent company, China State Construction Engineering Corporation, which helps the company maintain smooth financing channels and business conditions when buying land and investing in commercial projects.

S&P has raised China Overseas' long-term issuer credit rating from 'BBB+' to 'A-', and its long-term unsecured notes from 'BBB+' to 'A-', and upgraded its existing medium-term note program rating to 'A-'. The bank's outlook for China Overseas is 'stable'.