The Chinese banking regulator assigned trust companies to reduce the financing of a real estate and industrial sectors facing overproduction.
Directive of the Chinese Commission on Banking Regulation (CBRC) complements a number of measures taken by Chinese regulators for the purpose of solving two problems, which, according to analysts, carry the greatest threat to financial stability: overheating of housing market and increase in shadow financing.
The Chinese authorities seek to limit the risks while avoiding negative consequences for the economy.
CBRC plans to adopt a series of measures to restrict the financing of real estate market by the trust industry, which has funds in the amount of about 20 trillion yuan ($2.9 trillion), Bloomberg reports with the reference to informed sources.
