China pushes state banks to accelerate funding for private property developers

-Financial Times Chinese authorities are putting pressure on state banks to accelerate lending to private property developers, as they strengthen efforts to revive the country’s debt-stricken real estate market by supporting some of its biggest and most precarious companies.

Chinese regulators have instructed state banks to ensure the amount of loans to private property developers at least match the sector-wide average, according to two people who attended a gathering in Beijing on Friday of senior government and banking officials.

Shares of private developers jumped last week. The companies, which lack the support of their state-backed rivals, have been at the heart of a crisis in China’s property sector, which previously accounted for more than a quarter of economic activity in the country.

A barrage of defaults at private developers, led by Evergrande, the world’s most indebted property company, in 2021, has shaken confidence in China’s economy, leaving creditors to chase unpaid debts and real estate projects to sit unfinished across the country.

The unfolding funding crisis has pushed Country Garden, once China’s biggest private developer by sales and long thought of as more financially stable than its peers, into bond default this year.