CBRC Chairman Liu Mingkang: Banks Can Withstand House Prices Down By 40%

The Banking Regulatory Commission disclosed yesterday that CBRC Speaking at the CEO summit, President Liu Mingkang mentioned the latest. Housing loan Pressure test results show that even if house prices fell by 40%, the provision coverage rate is still higher than the international standard of 110%, China's banking industry Real estate The overall risk is controllable.

Liu Mingkang: house prices drop 40%, banking industry is still risk controllable

Source: its column: Liu Mingkang said this is closely related to the following factors. First, the proportion of real estate credit assets in China's banking system is relatively low. By the end of 8 2011, the balance of real estate loans (including land reserve loans, development loans and personal housing mortgage loans) of banking financial institutions was 10 trillion and 400 billion yuan, accounting for 19.8% of loans, which is quite different from that of many European and American banks in real estate and related assets.

Second, China is effective in controlling the derivatives of real estate in banking industry. The number of securitized products is very small. The ratio of other innovations such as collective trust and real estate loans is only about 4%, and the risk characteristics are relatively simple.

Third, from the specific structure of real estate loans, at present, about 98% of the personal mortgage loans "loan to house price ratio (LTV)" is less than 80%, mortgage loans average "debt to income ratio" is 33%, more than 1/2 of mortgage loans and development loans are issued in the two quarter of 2009 before the housing price is high again, the average loan ratio of development loans also reaches 189%, even if the real estate collateral severe stress test falls 40%, the coverage rate is still higher than the international 110% standard. All these indicate that the overall risk of China's real estate loans is controllable.