New Delhi: JP Morgan Chase expresses concern over China allowing banks to offer unsecured loan for the character developers And warned that it “would be a risky move” for lenders, the SCMP reported.
The measure “will be negative for banks as it will raise concerns about National Service risk and credit risk in the medium term. ,
“Implementation will be challenging, as banks may sidestep such guidance due to credit risk concerns,” SCMP quoted analysts Katherine Lei and Carl Chan as saying.
According to Bloomberg, China is considering allowing banks to lend to some construction companies without any collateral to free up capital for debt repayment.
According to the report, the move is one of several actions aimed at addressing the ongoing property crisis in China, which has caused many companies to fail to meet their financial obligations.
Due to this, concern has also increased in the markets about the possibility of financial crisis spreading.
Authorities are reportedly in the process of preparing a list of 50 property developers, including companies like Country Garden Holdings and Sino-Ocean Group, who will be eligible for financial assistance.
JPMorgan recommends buying property shares and selling bank shares if information about unsecured loans becomes reality.
Analysts expect the ongoing positive updates to boost property stocks in the near future, although they caution that this positive trend may not last long.
He also said that any additional financial support for private developers is likely to be provided selectively and with certain conditions, SCMP reported.
The measure “will be negative for banks as it will raise concerns about National Service risk and credit risk in the medium term. ,
“Implementation will be challenging, as banks may sidestep such guidance due to credit risk concerns,” SCMP quoted analysts Katherine Lei and Carl Chan as saying.
According to Bloomberg, China is considering allowing banks to lend to some construction companies without any collateral to free up capital for debt repayment.
According to the report, the move is one of several actions aimed at addressing the ongoing property crisis in China, which has caused many companies to fail to meet their financial obligations.
Due to this, concern has also increased in the markets about the possibility of financial crisis spreading.
Authorities are reportedly in the process of preparing a list of 50 property developers, including companies like Country Garden Holdings and Sino-Ocean Group, who will be eligible for financial assistance.
JPMorgan recommends buying property shares and selling bank shares if information about unsecured loans becomes reality.
Analysts expect the ongoing positive updates to boost property stocks in the near future, although they caution that this positive trend may not last long.
He also said that any additional financial support for private developers is likely to be provided selectively and with certain conditions, SCMP reported.
(TagstoTranslate)Unsecured Loan(T)Risk(T)JP Morgan(T)Developers