Beijing bank regulator orders crackdown on illegal property loans
- Capital’s branch of China Banking and Insurance Regulatory Commission warns lenders they will be held accountable for illegal inflows of cash into real estate
- Order to investigate use of personal and business loans comes amid growing fears of a house price bubble
The Chinese capital’s bank regulator has ordered an investigation into the illegal use of personal loans to invest in real estate amid growing fears of a property bubble.
The Beijing branch of the China Banking and Insurance Regulatory Commission told banks in the city to conduct a comprehensive examination into personal and business loans issued since the second half of last year.
They must “immediately rectify problems found and strengthen internal accountability”, according to a report by state news agency Xinhua, which cited an unnamed bureau official.
Banks will be held accountable if they are found to have allowed “illegal inflows of consumer loans and loan funds into the real estate sector”, the report said.
The investigation follows a similar move by the Shanghai financial authorities on Friday.
Strong sales in some cities in recent months have raised concerns among policymakers that the real estate market might be overheated, prompting new measures to control funds flowing into the sector.