China Banking Regulatory Commission recently issued a circular, risk warning and norms of the real estate investment, securities and other sensitive service, at the same time the Banking Regulatory Bureau attaches great importance to the liquidity risk of the trust company.

Some of the media reports, the notification requirement, no liquidity loans to enterprises engaged in real estate development company, it is strictly prohibited to purchase real estate development enterprise assets of repurchase commitment in the form of liquidity loans, real estate development enterprises not to grant loans to pay land transfer price. To strictly prevent liquidity loans to construction companies, group companies for real estate development.

Notice again, it is strictly prohibited to did not obtain "four card" of the real estate project loans, it is strictly prohibited to invest additional commitment to repurchase, commercial housing pre-sales indirectly the issuance of real estate loans. For real estate developers financing threshold, then again capital ratio of more than 35%, "four cards" complete, more than two professional development three conditions all have the ability to finance.

For land reserve loans, CBRC trust company issued cautious. The institutions of government land reserve loans with mortgage payment, the purchase of the land should have the legitimate land use permits, the loan amount may not exceed 70% of the value of the land acquisition assessment, the longest period of the loan shall not exceed two years.

Notice and provisions, the trust company should pay great attention to risk prevention operation process, trust companies to establish and improve the real estate loan approval standards, operational procedures and risk management policies; to conduct due diligence, strict implementation of the real estate loan guarantees, loans and investment to closely monitor the situation, to strengthen project management.

Relevant data shows, this year 1 to August, a total of 55 real estate financing trust products was established, the total amount of real estate financing products more than 2007 full year.

Report quoted industry sources as saying, some developers through the trust financing costs as high as 20%. Cost plus the real estate business from no bank financing, risk of small and medium-sized real estate business fund chain break is very large.