China boosts policy bank loans amid expectations of housing support
2024.01.02 05:22
© Reuters. FILE PHOTO: The headquarters of the People’s Bank of China, the central bank, is pictured in Beijing, China, as the country is hit by an outbreak of the new coronavirus, February 3, 2020. REUTERS/Jason Lee/File Photo
BEIJING (Reuters) – China’s central bank made 350 billion yuan ($49.1 billion) in loans to policy banks via its pledged supplementary lending (PSL) facility in December, fuelling expectations of increased support for the ailing housing sector.
The People’s Bank of China, which released the data in a statement on Tuesday, did not say how the loans would be used by the banks – China Development Bank, Export-Import Bank of China and Agricultural Development Bank of China.
This is the first monthly increase in PSL loans since November 2022. The PBOC made 630 billion yuan in such loans between September and November 2022 to support the economy amid the COVID-19 pandemic.
China plans to provide at least 1 trillion yuan of low-cost financing to the country’s urban village redevelopment and affordable housing programmes to shore up the struggling property market, Bloomberg News reported in November.
Outstanding PSL loans were at 3.252 trillion yuan at the end of December, compared with 2.902 trillion yuan at the end of November, PBOC said.
The PSL programme, initiated in 2014, was originally designed to help support any property downturn by funding urban redevelopment across the country, pushing up property prices in the process.
China relied heavily on PSL loans to support its shanty-town renovation during 2015-2018.
($1 = 7.1348 )
