On November 9, China Bond Credit Enhancement Company issued a notice on receiving materials for real estate companies' credit enhancement business for bond financing support tools.
notice shows that in order to further promote the work of bond financing support tools for private enterprises and increase credit enhancement services for private real estate enterprises, private real estate companies that intend to provide credit enhancement needs to China Bond Credit Enhancement Company by filling out the "Project Demand Intention Form", and the company will provide email feedback within 3 working days after receiving the email.
Multiple measures to support private real estate companies' financing
November 8, according to China Interbank Market Dealers Association , in order to implement a package of policies and measures to stabilize the economy, adhere to the " two unshakable " and support the healthy development of private enterprises, under the support and guidance of People's Bank of China , the Dealers Association continues to promote and expand the bond financing support tool for private enterprises (the "second arrow") to support private enterprises including real estate companies to issue bond financing.
"Second Arrow" is supported by People's Bank of China re-lending . Professional institutions are entrusted to support private enterprises in issuing bond financing in accordance with the principles of marketization and rule of law, through guaranteeing credit enhancement, creating credit risk mitigation certificates, and directly purchasing bonds. It is expected to support about 250 billion yuan in bond financing for private enterprises, and it can be further expanded as appropriate in the future.
This is also the regulatory authorities have repeatedly supported private real estate companies with clear actions to raise .
On October 27, Pan Gongsheng, Vice President of the People's Bank of China, went to China Bonds to conduct a special investigation, and said that the recent China Bonds increase "played an important role in maintaining the stability of bond financing for private real estate companies", and asked China Bonds increase to "increase support for bond financing for private real estate companies." Ping An Securities fixed income team believes that central bank has put forward further requirements for the increase in China's bonds, and it is expected that the scale of subsequent guarantees will be increased.
On November 1, the Traders Association and the Real Estate Industry Association jointly with China Bonds Investment, convened a symposium of 21 private real estate companies including Jinhui , New Hope Real Estate, Dexin China, Dahua Group , Renheng Real Estate, and Country Garden. At the same time, the symposium made it clear that it will continue to increase support for private real estate companies to issue bonds, and is currently promoting the issuance of credit bonds by more than ten real estate companies, involving an amount of approximately 20 billion yuan.
On November 7, the National Development and Reform Commission announced the "Opinions on Improving the Policy Environment and Strengthening Support for the Development of Private Investment", which proposed to improve the bond financing support mechanism for private enterprises and increase support for bond financing for private enterprises.
According to incomplete statistics from China Index Academy , the real estate market has been deeply adjusted, and nearly one trillion yuan of funds have directly supported real estate companies this year. In the first half of the year, the scale of support for real estate mergers and acquisitions loans and mergers and acquisitions bonds exceeded 100 billion yuan; in May and August, demonstration real estate companies had 10 billion yuan in financing through credit risk mitigation tool and fully guaranteed bond issuance; at the end of August, the regulatory authorities established a special loan of 200 billion yuan for guaranteed buildings; at the end of September, the regulatory instructions added 600 billion yuan in loans to real estate, and this policy supported private real estate companies to issue bonds for financing of tens of billions, and a total of nearly one trillion yuan in funds were supported by real estate companies this year.
industry financing has shown signs of repair
China Index Academy monitored that in October 2022, the total non-bank financing of real estate companies was 55.68 billion yuan, and rose 16.4% year-on-year and 27.0% month-on-month. The industry average interest rate was 3.48%, a year-on-year decrease of 2.39 percentage points, and rose 0.01 percentage points month-on-month. Financing this month showed positive growth for the first time compared with the first period of the industry's downward cycle, and industry financing has shown signs of recovery.
From January to October 2022, the total non-bank financing of real estate enterprises was 753.55 billion yuan, a year-on-year decrease of 51.4%. From the perspective of financing structure, credit bonds account for 53.5%, an increase of 22.4 percentage points year-on-year; overseas debt accounts for only 2.3%, a decrease of 14.6 percentage points year-on-year; trusts account for 10.9%, a decrease of 18.0 percentage points year-on-year. ABS accounted for 33.3%, an increase of 10.2 percentage points year-on-year.
From the perspective of financing structure, credit bond scale accounted for 57.4% in October, overseas bond accounted for 0%, trust accounted for 4.9%, and ABS financing accounted for 37.7%.Specifically, credit bond financing in the real estate industry increased by 155.7% year-on-year and 17.5% month-on-month; trust financing decreased by 72.1% year-on-year and 46.5% month-on-month; ABS financing increased by 22.2% year-on-year and 35.3% month-on-month.
In terms of total volume, compared with the same period last year, the issuance volume from January to October has shrunk to 16.4% year-on-year, and the monthly issuance volume is basically stable. From the perspective of issuing entities, the total issuance of central state-owned enterprises only decreased by 0.9% year-on-year, accounting for 87.1% of the total issuance, an increase of 14 percentage points. Therefore, the repair of credit bonds mainly depends on the issuance of central state-owned enterprises, and private enterprises are still facing issuance difficulties.
Real estate stocks generally rose
Thanks to the release of positive news, real estate stocks generally rose today. As of the close of 15:00, Sunshine City , Jinke Co., Ltd., Xincheng Holdings, and Zhongnan Construction's first board hit the daily limit ; Jindi Group , Xinhualian , China Fortune Land Development , etc. also hit the daily limit in the morning.
Hong Kong stock , as of the closing of the afternoon, the domestic real estate sector rose 3.12%, of which Xuhui Holdings Group rose 28.57%, and Longguang Group , Country Garden , R&F Real Estate and other stocks received 11%-19% increase in .
More than 20% real estate bond prices rose by more than 20%. For example, "16 Jindi 02" rose by more than 34% to rank first, "21 Longhu 01", "21 Jinke 04" rose by more than 20%; "16 Longhu 02", "20 Longhu 05", 21 Greentown 01", "18 Longhu 04" both rose by more than 15%.
Research head of the Enterprise Division of the China Index Academy, Liu Shui, analyzed that the public release of the receiving email address and the application form, and the intentional private real estate companies can propose credit enhancement needs to the China Bond Credit Enhancement Company by filling in the demand intention form. This information is fully disclosed and indicates that the branch is underway. There is no list restriction for real estate companies, and all intent private real estate companies can apply. In addition, the acceptance time of the demand table is not written, which also indicates that there is no time limit.
However, the "Project Demand Intent Form" clearly lists 5 "Hypermit methods to be provided": risk mitigation of financial institutions, counter-guarantee of state-owned enterprises, asset mortgage, counter-guarantee of affiliated enterprises, and counter-guarantee of state-owned guarantee (enhanced) institutions. Enterprises provide these risk mitigation tools, which require funding expenses, assets, credit resources, etc. as conditional support. Some private real estate companies will be restricted, and perhaps only some enterprises have the conditions to apply for support.
Nandu·Wan Finance Society reporter Wang Yanling
