China's central bank urges proper control of property loans

China's central bank on Wednesday called on all kinds of banks in the country to keep their loans to the property sector at a reasonable level while increasing credit support for key areas and weak links in the national economic and social development.

Banks should adhere to the principle of "houses are for living in, not for speculation," adjust and optimize their credit structures and implement long-term mechanisms to maintain the sound development of the real estate market, said the People's Bank of China in a statement.

China will strictly prohibit consumption loans from being irregularly used for house purchases and strengthen the management of capital flowing to the property sector from banks' wealth management, entrusted loans or other channels, according to the statement.

The country will also strengthen supervision over fundraising activities of large property developers with high leverage, and properly control the scale of interest-bearing liabilities and the asset-liability ratios of such companies.

Meanwhile, medium- and long-term loans to the manufacturing sector should be increased to prop up high-quality growth of the sector.

The central bank also asked the country's banking sector to continue to improve financial services to small- and medium-sized firms and other key areas including the modern service industry, rural vitalization and poverty relief, said the statement.