CHINA’S top banks will lower interest rates on existing mortgages from Oct 25, state media said Saturday (Oct 12), after Beijing’s central bank requested the adjustment to reduce pressure on homeowners.
“Except for second mortgages in Beijing, Shanghai, Shenzhen and some other regions, the interest rates on other eligible mortgages will be adjusted” to no less than 30 basis points below the prime lending rate, the central bank’s benchmark rate for mortgages, state broadcaster CCTV said.
CCTV reported that major banks including the Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, and China Construction Bank had announced that they would make the adjustments “in batches”.
The banks said the tweaks “will be uniformly done… and customers do not need to apply for them”, CCTV reported.
The People’s Bank of China last month requested that commercial banks lower such rates by Oct 31.
The move comes as Chinese policymakers unveil a string of stimulus measures to boost an economy blighted by a years-long property sector crisis and chronically low consumption.
The measures have included a suite of rate cuts and a loosening of rules on buying homes, but economists have said that more action is needed to pull the economy out of its slump for good.
Finance Minister Lan Fo’an is expected to announce further fiscal stimulus at a highly anticipated press conference in Beijing on Saturday. AFP