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August 26, 2016

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Home » Business » Finance

Shares dip on talk of loan curbs

By Ding Yining | August 26, 2016, Friday | Print Edition

SHANGHAI stocks closed lower yesterday amid concerns that government measures would be unveiled to curb lending to developers and homebuyers.

The Shanghai Composite Index lost 0.57 percent to close at 3,068.33 points. Turnover was a fairly low 200.9 billion yuan (US$30.2 billion).

Curbs on lending to developers and homebuyers are expected as the authorities do their utmost to rein in rising housing prices, Bloomberg News cited unidentified sources as saying yesterday.

Gemdale Corporation sank 4.06 percent to 11.34 yuan (US$1.70) while China Vanke Co lost 1.88 percent to 23.54 yuan. Poly Real Estate Group shed 2.07 percent to 9.47 yuan.

Trading sentiment yesterday was muted after the China Banking Regulatory Commission on Wednesday unveiled aggressive measures to curb China’s fast-growing peer-to-peer lending sector as nearly 50 percent of the sites are “problematic”.

They include limiting an individual to borrow up to a maximum of 200,000 yuan from each P2P platform, capped at 1 million yuan in total, as well as forbidding online lending platforms from taking public deposits or selling wealth-management products.

The CBRC acted to curb risks and reduce leverage in the banking, insurance and brokerage sectors. Market watchers, however, worried that these actions might restraim capital inflow and impact on trading sentiment.

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