BEIJING Feb 26 China's Ping An Bank
has banned its branches from approving home loans in a move by
banks turning cautious on the country's frothy property market,
where prices are again zooming towards record highs.
A recent rebound in China's home prices has fanned investor
speculation and risk that the government may toughen a
three-year campaign to cool property price inflation by
introducing new measures.
"Our head office has asked branches to hand over the right
to examine and approve mortgage loans recently and all mortgage
cases will be handled by the headquarters," Ping An said in an
email reply to Reuters.
"The head office will prioritise loans for home occupiers
while restricting speculative purchases of homes," Ping An said.
In a bid to calm the real estate market, China's cabinet
last week restated its intentions to expand a pilot property tax
programme to more cities and urged local authorities again to
control prices of new homes.
To raise China's record-low home affordability and keep a
lid on social discontent, Beijing has instructed banks to
prioritise and assist first-home buyers.
As such, some banks, including Ping An, give first-home
buyers a 15 percent discount on benchmark interest rates for
mortgages. Second-home buyers, on the other hand, are charged
mortgage rates 1.1 times that of benchmark levels, Ping An said.
(Reporting by Xie Heng, Shao Xiaoyi and Koh Gui Qing; Editing
by Robert Birsel)