HONG KONG, Sept 11 (IFR) - The China Securities Regulatory
Commission (CSRC) has asked the Shanghai and Shenzhen Stock
Exchanges to collect more information on listed companies'
property-related funding plans, according to a September 4
document seen by IFR.
The document calls for materials on any merger,
restructuring or refinancing plans related to property
development, confirming that the securities watchdog is once
again reviewing fundraising proposals from the real estate
A handful of Chinese developers have announced onshore
financings in recent weeks, including Guangzhou R&F, which is
planning to raise up to CNY6bn (USD980.4m) in the corporate bond
market, subject to regulatory approval.
The CSRC document, however, is the first official sign that
regulators are set to end a three-year freeze on local capital
raisings from real-estate companies.
In order to curb soaring property prices, the CSRC stopped
reviewing any fundraising proposals from Chinese property
developers in early 2010, forcing many property companies to
look to more expensive alternatives, such as overseas bonds or
onshore trust financings.
A softer stance to onshore financings could have a
wide-ranging impact, potentially improving the credit profile of
property sector companies and reducing the supply of overseas
Rumours about the CSRC document yesterday had already buoyed
stock of some of the Chinese developers that have shares listed
in Hong Kong. China Overseas Development traded up 2.94%, China
Resources Land jumped 3.22%, Guangzhou R&F Properties rose 4.67%
and Yiuxiu Property gained 4.71% yesterday.
However, market participants expect any approvals to be on a
case-by-case basis, and few are predicting a sudden flood of
domestic bonds or shares from the property sector.
The CSRC document calls for details of recent activity and
future plans in both the residential and commercial property
sectors. The authorities will then check to see if the company
has deliberately delayed projects in the past three years in
order to sell its inventory at higher prices, the document
On top of that, the document stated that proposals will also
need to be checked by "related parties", hinting that the
government will retain the final say over the projects that win
The CSRC is working with the Ministry of Land and Resources
and Ministry of Housing and Urban-Rural Development, the
(Reporting By Carrie Hong; editing by Christopher Langner and