September 23, 2014 / 12:11 AM / 5 years ago

Top China bank to relax rules on home loans - official paper

SHANGHAI, Sept 23 (Reuters) - One of China’s top four state banks plans to ease rules on mortgage lending as the government seeks to bolster the country’s flagging property market, the official Shanghai Securities News reported on Tuesday.

The latest report came a day after 21st Century Business Herald cited unidentified sources as saying that China’s “Big Four” banks would ease mortgage lending in a move orchestrated by regulators.

The country top state-owned lenders are Industrial and Commercial Bank of China , China Construction Bank , Agricultural Bank of China and Bank of China Ltd .

Shanghai Securities News reported that one of the banks would offer a 30 percent discount on mortgage interest rates to first-time home buyers, which would include those who have paid outstanding mortgages, and also ease lending policies on second-home buyers.

China’s new home prices fell in August for a fourth straight month and declines spread to a record number of cities, according to data last week, underlining a deepening downtrend in the property market that is increasingly weighing on the broader economy.

Many Chinese cities have relaxed home purchase restrictions as local governments seek to support a key pillar of the economy.

Nanjing, a city in eastern Jiangsu Province, abolished on Sunday restrictions that limit the number of homes that residents can buy, meaning that 40 of 46 regional Chinese governments that had imposed home purchase limits have relaxed the curbs this year.

On Monday, Fuzhou, capital city of the southeastern province of Fujian, also relaxed mortgage lending rules, allowing people who have paid off mortgage loans to be considered as first-time home buyers and enjoy preferential rates, the Shanghai Securities News said. (Reporting by Samuel Shen and Kazunori Takada; Editing by Shri Navaratnam)

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