China regulator plans to improve balance sheets of 'good quality' developers

Midea Real Estate Holding

21/11/2022 11:16

By Xie Yu
       HONG KONG, Nov 21 (Reuters) - China needs to implement
plans to improve the balance sheets of "good quality" property
developers reeling from a cash crunch in the sector, the head of
the country's securities regulator said on Monday.
    "(We) need to closely pay attention to the difficulties and
challenges facing the property industry," Yi Huiman, chairman of
the China Securities Regulatory Commission (CSRC) said during a
financial forum in Beijing, Chinese media Yicai reported.
    The comments come as Beijing steps up its support measures
for the country's embattled property sector, which accounts for
roughly a quarter of the economy, with the deepening debt-crisis
also hitting developers with relatively stronger balance sheets.
    China's property sector has slowed sharply in the past year
as the government sought to restrict excessive borrowing. The
clampdown triggered falls in property sales and prices, bond
defaults and the suspension of construction.
    Yi said support was needed to carry out plans to improve the
balance sheets of good-quality developers, facilitate merger and
acquisition deals and related financing demand, and meet
reasonable financing demand by property companies via bonds.
    Chinese regulators earlier this month outlined 16 steps to
support the industry, including loan repayment extensions, in a
major push to ease the deep liquidity crunch which has plagued
the property sector since mid-2020.  urn:newsml:reuters.com:*:nL1N32902C
    Last week, two private developers Longfor Group Holdings Ltd
 0960.HK  and Midea Real Estate Holding Ltd  3990.HK  received
green light to raise a total of 35 billion yuan ($5 billion) in
debt.  urn:newsml:reuters.com:*:nL1N32B0SF
 (Reporting by Xie Yu, Editing by Louise Heavens)
 ((Yu.Xie@thomsonreuters.com;))