Multiple regions follow up on the intensive implementation of the "white list" for real estate financing.

Recently, several cities have successively released the first batch of "white lists" for real estate project financing. Various cities have made intensive statements, and the banking industry is also quickly following suit, indicating that the newly announced real estate financing coordination mechanism is operating rapidly.

Prior to this, on January 12th, the Ministry of Housing and Urban-Rural Development and the China Banking and Insurance Regulatory Commission jointly issued a notice requiring cities at and above the prefecture level to establish urban real estate financing coordination mechanisms, timely assess the local real estate market situation and financing needs, and coordinate the resolution of difficulties and problems in real estate financing.

"White Lists" of Real Estate Projects Released in Multiple Cities

On January 30th, Nanning in Guangxi became the first city to announce the establishment of a real estate financing coordination mechanism and sent the first batch of 107 real estate projects to local financial institutions on the "white list".

On January 31st, the Chongqing Housing and Urban-Rural Development Bureau announced on its WeChat official account that it had sent the first batch of real estate projects on the "white list" to financial institutions, including 314 projects with a financing demand of approximately 83 billion yuan. On the same day, Kunming announced the first batch of 212 real estate projects on the "white list" with a financing demand of approximately 91.6 billion yuan, and sent them to 28 major banks including policy banks, large commercial banks, joint-stock commercial banks, and city commercial banks in Kunming. This facilitates the support of banks in accordance with market-oriented and rule-of-law principles based on comprehensive evaluations. The Chongqing Regulatory Bureau of the China Banking and Insurance Regulatory Commission stated that the financing coordination mechanism will dynamically manage the "white list" and will add eligible projects in the future while removing projects that do not meet the criteria.

On January 31st, Chengdu also announced on its official WeChat account that the first batch of project financing applications had completed the initial review, including 227 projects from 208 project enterprises. Qingdao announced that through the real estate financing coordination mechanism, it had compiled the first batch of 84 real estate projects on the "white list" with a financing demand of approximately 25.02 billion yuan, involving 19 financing institutions.

In Harbin, the first batch of financing-supported real estate project "white list" was announced on January 31st, with a total of 19 projects and a financing demand exceeding 2.7 billion yuan.

In Xi'an, information disclosed on January 31st showed that the local government had sent the first batch of 54 project lists with a financing demand of approximately 17.984 billion yuan to the Shaanxi Regulatory Bureau and financial institutions of the China Banking and Insurance Regulatory Commission.

On February 1st, it was learned from the Wuhan Housing Security and Housing Management Bureau that Wuhan had determined the first batch of real estate project financing "white list", involving 101 real estate projects, 94 development companies, and 18 financing institutions. The Hubei housing department stated on the same day that the first batch of 221 real estate projects in Hubei Province had been reviewed by the urban real estate financing coordination mechanism and had been sent to various financial institutions, involving 16 cities and prefectures with a financing demand of 71.2 billion yuan.

It is understood that Jiangxi is currently further refining and clarifying the implementation methods and detailed rules of the coordination mechanism, steadily advancing the construction of departmental consultation platforms and government-bank-enterprise cooperation platforms; Guangzhou is building a government-bank-enterprise communication platform to promote accurate connection between real estate development companies and financial institutions; Inner Mongolia is pushing forward the first batch of project lists and preparing for the second batch...

What role can the "white list" play?

Previously, the relevant person in charge of the Ministry of Housing and Urban-Rural Development stated that the current cash flow tightness of real estate companies is mainly due to two reasons: market demand and corporate financing. Therefore, the recently introduced real estate financing coordination mechanism has a key goal of solving the financing problem.

Therefore, the "white list" can be simply understood as a list of real estate projects under construction as financing support objects. It is important to note that the objects on this list are projects, not companies. Pu Zhan, Deputy Director of the Policy Research Center of the Ministry of Housing and Urban-Rural Development, said that this can meet the reasonable financing needs of project development and construction, and can shift the situation of excessive risk aversion by financial institutions to a virtuous cycle of finance and real estate, thereby promoting the normal development, construction, and delivery of real estate projects, helping to restore market confidence and improve market expectations.

Of course, not all projects can be included in this list. Different regions have clear and strict requirements for which projects can enter the "list":

• Real estate development projects must be in the construction phase, including short-term suspension of work but can resume immediately after funds are in place, and can be completed and delivered.
• Real estate development projects must have collateral or mortgage guarantees that are basically matched with the financing amount.
• Real estate development projects have identified the main banks to apply for loans and accept closed management of loan funds.
• The pre-sale funds of real estate development projects have not been misappropriated, or the misappropriated funds have been promptly recovered.
• Real estate development projects have preliminarily formulated plans for the use of loan funds and completion.

It should be noted that being included in the "white list" does not mean that the real estate project can obtain financing from financial institutions. The "white list" is only a recommended list, and the final decision-making power lies with the financial institutions.

Banks strongly support the implementation of the "white list"

Recently, various banking and financial institutions have taken swift action, and the lending for real estate development by many banks has been increasing month by month, meeting the reasonable financing needs of more and more real estate companies.

In Chongqing, the Agricultural Bank of China Chongqing Branch has approved the first local real estate white list project, with a loan of 320 million yuan. It is expected that the first installment of 54.5 million yuan will be disbursed early next week, mainly for the company to pay wages and project costs. It is reported that due to the use of the real estate financing green channel, the loan approval only took 6 working days, while similar projects in the past generally took 20-30 working days to complete the approval. Currently, the Chongqing Branch of the Agricultural Bank is also coordinating with the other 8 projects in the real estate project "white list".

In Nanning, Guangxi, Minsheng Bank Nanning Branch has already disbursed the first loan from the local real estate project "white list", involving a fund of 330 million yuan.

Tian Jianming, Deputy General Manager of the Corporate Business Department of China Construction Bank, said that they have exchanged information with 6 real estate companies and enhanced mutual trust. Recently, the head office of China Construction Bank also sent 6 teams to conduct research in 12 provinces and cities. Preliminary research shows that many of the current main problems of real estate companies are liquidity issues. Therefore, based on the stable increase in real estate credit investment last year, China Construction Bank has further accelerated its response to reasonable financing needs. In addition, several banks including Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, and Zhejiang Commercial Bank have held multiple symposiums since December last year to support the reasonable financing needs of real estate enterprises, and have subsequently increased their funding support.

Multiple banks to establish green approval channels for real estate loans

According to reports, several banks have established special working groups for urban real estate financing coordination mechanisms to further enhance the financial support for the reasonable financing needs of real estate enterprises. At the same time, efforts are being made to expedite the establishment of green approval channels for real estate enterprise loans and shorten the approval process.

Industrial and Commercial Bank of China (ICBC) stated that it will strengthen precise communication with various real estate enterprises, improve the internal green approval channels, optimize the approval process, and shorten the approval time. ICBC will increase its financing support for projects on the list and meet the reasonable financing needs of various types of real estate enterprises. It is reported that since November 2023, ICBC has gradually increased its lending to non-state-owned real estate enterprises on a monthly basis. By the end of 2023, ICBC's real estate development loan balance exceeded one trillion yuan, achieving a year-on-year increase.

China Construction Bank (CCB) stated that for projects supported by the coordination mechanism, it will initiate business processes as soon as possible, provide financing services promptly, and achieve completion and delivery as soon as possible. For projects that are temporarily facing difficulties but have a basically balanced fund, CCB will extend the loan repayment period if necessary, stabilize the fund chain, construction progress, and market confidence.

Several banks also stated that in the future, they will better support the demand for both rigid and improved housing, and increase financial support for affordable housing, urban village transformation, and the construction of "three major projects" for emergency and regular use public infrastructure.

Financial regulatory authorities stated that for projects on the "white list" of real estate financing, the principle of closed financing operation will be adhered to. Development enterprises and banking and financial institutions will voluntarily negotiate and reach an agreement to ensure that loan funds are managed and used in a compliant manner, and are fully used for the construction of the project, preventing funds from being diverted to unrelated investments and expenditures.

Authors: Yang Xiao, Wang Lei, Source: CCTV News, Original Title: "Multiple regions follow up, real estate financing 'white list' intensively implemented"