Property News · April 25, 2016

Shanghai banks ordered to cut ties with six property firms


Beijing // China’s banking watchdog has ordered commercial banks in Shanghai to cut off cooperation with six real estate companies including the nationwide HomeLink Real Estate, which has branches across most Chinese cities, and helps wealthy Chinese to make property investments in overseas locations. The other five were not named.The ban will last one month starting April 25, and will be reviewed after that. The order came after the China banking regulatory commission said it found that some commercial banks had illegally transferred money from mortgage loan accounts to certain third parties, who were not involved in the properties for which the mortgages were taken out. These third parties were found to have further moved money to one of the six real estate companies in Shanghai, according to information provided by the Shanghai government. Some of the estate agencies also helped home buyers to acquire down-payments for property purchases through illegal channels, it said. The banking regulator has also asked seven unnamed Shanghai banks to stop giving housing loans to individuals for two months after they were found to have broken rules in making advances, it said. The ban order impact the property market at home and overseas because the six real estate agencies involved account for the majority of homes on sale in a market and very few direct deals take place. A Chinese news portal, thepaper.com, quoted a HomeLink official saying that the company will have to adopt alternative measures to deal with the situation but he did not elaborate further.business@thenational.aeFollow The National’s Business section on Twitter

Source : thenational.ae
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