2021年4月23日

Big break! Shenzhen code strict inspection of all loans, business loans, credit cards, consumer loans

Journalist Xin Jizhao

Shenzhen has tightened regulation on real estate-related loans, requiring commercial banks to report quarterly results of investigations on operating loans, mortgages, development loans, consumer loans and credit cards to the regulator.

It is the latest sign of tighter regulation of property funds.

Regulators in Shenzhen have ordered quarterly checks on the implementation of real estate credit controls and whether funds from business loans are illegally diverted to the property market, two industry insiders told the 21st Century Business Herald on March 30.

On the same day, Shenzhen Banking and Insurance Regulatory Bureau responded to the 21st Century Business Herald reporter said:

The rolling inspection scope is all the stock businesses up to the end of the reporting period, including real estate corporate and personal credit businesses, business purpose loans, consumer loans, credit cards, finance, investment and other off-sheet financing businesses, among which business purpose loans are the focus of the inspection, and the inspection results shall be reported within 5 working days after the end of each quarter.

Last week, the China Banking and Insurance Regulatory Commission, the Ministry of Housing and Urban-Rural Development, and the People’s Bank of China jointly issued the Notice on Preventing the Illegal Inflow of Operational Loans into the Real Estate Sector, resolutely cracking down on the illegal activities of the illegal inflow of operational loans into the real estate sector.

Industry sources told the 21st Century Business Herald that the regulator required Shenzhen commercial banks to conduct quarterly checks on two categories, namely real estate lending business and business lending business.

Among them, the real estate credit business, require commercial Banks to screen real estate development loans, individual housing loans, commercial housing loans, business loans, consumer loans, credit CARDS, other (including financial management, investment, etc.) if there is a violation of the real estate business credit policy, whether there is any illegal money into real estate industry. If there is, demand the recovery of illegal funds, explain the accountability situation.

The requirements for the investigation of business loans (referred to as business loans) are more detailed: commercial banks are required to conduct a detailed investigation on the scale of business loans, such as working capital loans to enterprises, personal business loans, and loans to small and micro business owners.

Examining loans in which the operating entity is established less than one year or the operating company cancels or transfers equity after the loan is issued;

Business loans with a term exceeding 3 years;

The borrower holds the mortgage for less than one year or six months;

The loan for new property of the borrower or his/her relatives (including the divorced spouse) within 6 months after the loan;

Loans with funds not used for the agreed purposes or returned to the accounts of the borrower and his relatives or to the affiliated enterprises of the borrower.

On the same day, shenzhen silver protects inspect bureau to respond to the 21st century business herald “reporter, said to continue to strengthen the real estate credit regulation, adherence to credit funds shall not be in violation of the inflow in the field of real estate regulation line, shenzhen silver protects inspect bureau in joint live built bureau of shenzhen, shenzhen central sub-branch of the people’s bank issued notice, facility’s business purpose loan violation into real estate problems, on the basis of the special screening, to establish real estate credit policy implementation and credit flows to the quarterly rolling screening mechanism.

Shenzhen Banking and Insurance Regulatory Commission said:

Will continue to maintain the real estate credit chaos control in the field of high pressure situation, the continuous increase of real estate related business investigations, supervision and inspection, found in violation of the real estate credit policies, credit funds compasses flows into real estate, will be divert loans ordering Banks to withdraw within a time limit, the responsible departments and personnel give strict accountability, and punishment shall be given heavier, strictly in accordance with the law.

In March this year, the 21st Century Business Herald reported exclusively that local regulators in Shenzhen convened a meeting of major commercial banks, requiring them to check the flow of funds from their business loans since 2020 and to penetrate the checks. The scope of investigation includes the purchase behavior of shareholders and their spouses who have been approved to operate loans since 2020 within 6 months before and after the loan, to penetrate the flow of funds.

On March 26, silver insurance regulatory commission, the ministry, the People’s Bank of China jointly issued “about preventing violations of business USES loans into notice in the field of real estate, from strengthening the borrower audit qualification verification, strengthen credit demand, strengthening management loan term and loan collateral management, strengthening the credit in the post-loan management, strengthen internal management, etc., supervise the banking financial institutions to further strengthen the prudential compliance management, fight loan violation into real estate business purposes.

At the same time, it requires further strengthening the management of intermediaries, establishing a “blacklist” of violations, increasing accountability for punishment and regularly disclosing them.

The above notification requirements:

We will strengthen credit demand audits. It is necessary to conduct a penetrating and substantive examination of the loan demand for business purposes, and shall not relax the examination of the real loan demand because of sufficient mortgage, and shall not grant operational loans to enterprises whose capital flow clearly does not match their business conditions.

We will strengthen the term management of loans. Want to determine loan time limit reasonably according to borrower actual demand. We will further strengthen internal management of loans for business purposes with a maturity of more than three years to ensure that the funds are really used for business operations.

Recently, a number of banks have also pledged to reduce the proportion of mortgages.

On March 29, Lu Jiajin, vice president of CCB, said at the bank’s earnings conference that CCB is taking various measures to steadily promote the steady development of its public real estate business, maintain the reasonable and moderate growth of personal housing mortgage loans, and orderly reduce the proportion of property-related loans in all loans.

‘Generally speaking, the transition period of the new rules on mortgage concentration is relatively abundant,’ he said. ‘It is expected that the new rules will have little impact on the growth of loan size, and the excess part will be digested year by year.’ CCB is also the largest home mortgage lender. Its annual report shows that as of the end of 2020, the outstanding balance of individual housing loans of CCB is 5.83 trillion yuan, an increase of 9.91%, accounting for 34.73%, slightly higher than the regulatory requirements.

For real estate loan concentration management, the Bank of Communications said that from the end of 2020 announced on the real estate loan ratio ceiling management policy, less impact on the Bank of Communications. Compared with other banks, the bank has further room to increase the quota. The recent operation of the loan in some hot cities disguised into the real estate market, the bank has been the investigation as a key work this year to promote, and the compliance work in the first place. By the end of 2020, BoCom’s real estate loans to public and mortgage companies totaled 1,642 billion yuan, accounting for more than 28% of customer loans.

According to the Notice on Establishing the Management System of Concentration of Real Estate Loan in Banking Financial Institutions jointly issued by the People’s Bank of China and the China Banking and Insurance Regulatory Commission on December 31, 2020, different banks are divided into five levels to manage the concentration of real estate loan according to their asset size and institution type. Among them, the six major state-owned banks, namely the Industrial and Commercial Bank of China, the Agricultural Bank of China, the China Construction Bank, the Communications Bank and the Postal Savings Bank, and the China Development Bank, rank first, with a ceiling of 40 percent for real estate loans and 32.5 percent for personal housing loans.

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