China picks 2 banks for securitization program

cctv.com 03-22-2005 10:59

China's State Council has authorized two banks, including top property lender, China Construction Bank, to pioneer a long awaited loan securitization programme.

The People's Bank of China on Monday, the pilot programme will begin immediately now that formal approval has been granted.

The other bank is the China Development Bank, which lends to key infrastructure projects. China Construction Bank would securities mortgage loans, while China Development Bank's credits, some of which will also be securitized, are mostly loans financing infrastructure development. They will sell securities backed by their credit portfolio to investors and list those securities on the markets. Securitization is expected to help China's fledgling bond market grow and mature. It could also enable state-owned lenders to clean up their balance sheets. Detailed loan securitization rules are still under discussion.

Editor:Chen Zhuo  Source:CCTV.com