China’s financial system stable, expectations for property market improved: PBC chief
Published: Dec 28, 2021 08:18 PM

PBC Photo:Xinhua

PBC Photo:Xinhua

China's financial system is running stable, financial risks under control, and expectations for the property market have improved with structural adjustment, Yi Gang, chief of China's central bank, said, while reassuring investors and refuting foreign media's exaggeration over Evergrande over the recent days.

Currently, China's financial system is generally operating smoothly, and financial risks are convergent and controllable, Yi, governor of the People's Bank of China, said in an interview with the Xinhua News Agency on Tuesday. 

Yi mentioned that some individual real-estate companies were exposed to risks due to their own mismanagement, blind diversification expansion and other factors, while authorities have actively taken measures to resolve risks in a stable and orderly manner, and fulfill financing needs of residents and real estate companies. 

"The structural adjustment of the property market is conducive to the formation of a new development model for country's real estate, and the sound development of the whole industry," Yi said, adding that market expectations are gradually improving.

The remarks showed that relevant departments are currently paying great attention to housing risks, but at the same time, they also hope that market participants will have a scientific and rational understanding of the market, Yan Yuejin, research director at Shanghai-based E-house China R&D Institute, told the Global Times on Tuesday.

The problem of real estate has indeed been seen by everyone, but the industry will develop in a positive direction, so there is no need to look at China's real estate market with pessimism, especially under effective measures by officials, Yan said.

During the Central Economic Work Conference held in mid-December, a key meeting that outlines top policy priorities for 2022, Chinese policymakers called for efforts to explore new development models for the industry, including the development of a long-term rental housing market, promoting the construction of affordable housing, supporting the commercial housing market to better meet the reasonable housing needs of buyers, while promoting a virtuous and stable circle for the industry.

Yan also expected relaxed house-buying policy to meet residents' real demand.

In the interview with Xinhua, Yi also stressed the importance of stability in China's financial system for the next year, calling for a stable and proactive fiscal policy to keep its monetary policy flexible and appropriate and liquidity ample.

To further alleviate burden and expand fundraising channels for businesses, Yi said firms in general can obtain corporate loans with an average interest rate of 5 percent, a record low.

Moreover, the central bank will issue a first batch of low-cost loans to financial institutions by the end of the month to enable carbon emissions cuts, aiming to to support the country's broader goal of bringing emissions to a peak before 2030 and achieve carbon neutrality by 2060.

Global Times