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UPDATE 1-China denies relaxing rules on mortgage loans
(Updates with central bank comment)
BEIJING, June 14 (Reuters) - China's central bank and banking regulator denied on Thursday media reports that it had relaxed rules on home mortgages, underlining the government's resolve to cool the property sector.
There have been media reports that the People's Bank of China had issued new guidelines permitting commercial banks to offer up to 30 percent discounts on loans to first-time home buyers.
The People's Bank of China said it had indeed issued a circular on mortgage loans following its interest rate cut last week, but the guidelines merely reiterated existing rules.
"The document made clear that banks are allowed to set rates on corporate loans for as low as 80 percent of the benchmark rate while refraining from lowering the floor on rates for individual home loans, which is 70 percent of the benchmark," the central bank said in a statement on its website, www.pbc.gov.cn.
"Some media reports misinterpreted the central bank's policy intention, raising the suspicion of speculation," it said.
Last week, the central bank cut benchmark interest rates by 25 basis points, the first such cut since the depths of the 2008/09 global crisis, and allowed banks to set their own lending rates to as low as 80 percent of the benchmark.
Separately, the China Banking Regulatory Commission (CBRC), the banking regulator, said the risk-weighting for home mortgages stays at 50 percent under tougher capital requirements to be implemented from January 2013.
"The new rules published on June 8 set the risk weighting for individual housing mortgage loans at 50 percent, which is in line with the current rules," the CBRC said in a statement on its website, www.cbrc.gov.cn..
Real estate stocks have risen this week on speculation the authorities may be considering relaxation of property curbs to boost growth. The property sub-index rose 4.5 percent this week, compared with a 0.6 percent rise in the benchmark index.
China is easing monetary policy to support the economy, which is on course to grow at the slowest pace since 1999 fanning speculation that Beijing may also consider relaxing its property controls that have been in place since 2009.
The government is bent on taming the property sector but a pick-up in housing sales in some major Chinese cities has raised suspicion that officials could be trying to spur the industry with hidden subsidies and other incentives.
The National Development and Reform Commission said on Tuesday media reports quoting an unidentified NDRC official as saying loosening property policies were a "second card to save the market" were fabricated.
(Reporting By Xiaoyi Shao and Kevin Yao; Editing by Ramya Venugopal and Robert Birsel)
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