China’s Big Four Banks Respond to Call for Mortgage Rate Adjustments
Beijing, September 29, 2024 – In a late-nightannouncement, China’s four largest state-owned banks – the Bank of China, Agricultural Bank of China, China Construction Bank, and Industrial and Commercial Bank of China – havepledged to actively participate in the adjustment of existing mortgage rates, following an initiative issued by the Market Interest Rate Pricing自律机制 (Self-Discipline Mechanism).
The initiative, published on the evening of September 29th, outlines a framework for commercial banks to conduct bulk adjustments of existing mortgage rates for eligible borrowers. This move is seen as a significant step towards alleviating the financial burden on homeowners facing risinginterest rates.
All four banks have issued statements confirming their commitment to the initiative. The Bank of China declared that it is actively responding to the initiative and is pushing forward the work in a lawful and orderly manner. Similarly, Agricultural Bank of Chinastated that it is actively implementing the initiative and will soon release specific implementation details.
China Construction Bank and Industrial and Commercial Bank of China echoed these sentiments, emphasizing their commitment to supporting the initiative and providing timely updates on their implementation plans.
This development comes amidst growing pressure on the Chinese government to address the concerns of homeownersgrappling with rising mortgage costs. The recent decline in market interest rates has created a significant disparity between new and existing mortgage rates, leading to calls for adjustments to ensure fairness and affordability.
The specific criteria for eligibility and the details of the adjustment process are yet to be announced. However, the swift response from the Big Four bankssuggests a strong commitment to addressing the issue and providing relief to homeowners.
The initiative and the banks’ subsequent responses are expected to have a significant impact on the Chinese real estate market. Analysts believe that the move could boost consumer confidence and stimulate demand, potentially contributing to a more stable and healthy housing market.
Furtherdevelopments in the implementation of this initiative will be closely monitored. This article will be updated as more information becomes available.
References:
- China News Service (2024, September 29). 四大行深夜回应！推进调整存量房贷利率工作. Retrieved from https://www.chinanews.com/cj/2024/09-29/9643286.shtml
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