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House prices still half Bank losses

yesterday, 2011 new financial Summit opens in Beijing. The theme of the Summit is looking for real growth. A number of government officials and scholars on China at the Summit discussed the most important issues in the future.

Liu mingkang   loans cleaned 60%

"at the end of September, local financing platforms of loan to clean up the progress has reached 60%. "Bank chairman Liu mingkang of the IPCC said yesterday.  

Mr Liu said local government debt at 10.7 trillion yuan, 80% comes from bank loans, but "early identification, early intervention, early disposal", the overall risk control. He further explained that because regulators require banks to loans in a timely manner-by-packet increase, individual assessment and progressive improvement, preservation, current loans coverage has greatly improved.  

Liu mingkang, introduction, since 2008, the CBRC required banks to real estate stress test, regulators will conduct a test, when home prices fell 40%, coverage has been able to bank loans 110%; and in the worst case, that is, when prices decreased by 50%, bank loans covered can of 100%, although the interest can't be recycled, but the principal is no problem.  

Liu said since the CBRC always differentiate between personal loans, the distinction between first and second homes, and there has never been a zero down payment, so in terms of individual mortgage loans, banks ' loan quality is relatively high.  

Andy Xie

house prices down is a good thing for China

Andy Xie, an independent Economist, pointed out yesterday that if house prices fall, on the national economy is a good thing. In his view, the Chinese Government as long as 6 months after bite, come, China's future is very bright. "Anyone who says that rescue, seek, is designed to stir up real estate, save yourself."  

"China's real estate bubble burst. "Xie said," last year, I think real estate will be off until 2012, it will be down, I changed my opinion in the first half of this year, will fall in the second half. "He further explains that no developer is the cause of the first half of any business and real estate developers have been turned into his platform. But today to lend his industry had been borrowed out, so the sharp decline in real estate is necessary.  

in Xie's view, if the Government moves to rescue of the real estate, to the Chinese term is negative. "Because once again confirmed that the Chinese model is to make money as long as the kidnapped Government, the kidnapping banks will not pour, the economic model is not broken, the economy there is no way out. " 

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