Greenland, Yango get state support as Beijing steps up efforts to appease irate home buyers
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CHINA'S Greenland Holdings said a unit has secured loans from state-owned shareholders and the parent of Yango Group signed a debt relief agreement with a state-backed bad loan company, as the government steps up efforts to aid the country's struggling real estate sector.
Amid a wave of buyers refusing to make mortgage payments on delayed housing projects, Beijing last month vowed to increase support to private developers and ensure buyers can take delivery of their homes.
Shares in Yango jumped by their daily limit of 10 per cent in early on Monday (Aug 8) trade, while Greenland gained roughly 4 per cent.
Chinese media also separately reported that Zhengzhou, the capital city of central Henan province, plans to set up a 10 billion yuan (S$2 billion) fund to tackle social and financial problems.
Greenland said in a statement on Monday that a subsidiary plans to borrow a combined 3 billion yuan from 2 state-owned shareholders. The 2-year loans, with an annual interest rate of 6 per cent, would help maintain ample liquidity, and help the company's efforts to sure the smooth handing over of homes, it said.
China Huarong Asset Management, a major bad loan company, said in a statement that it has recently signed a framework agreement with Yanggo Longking Group to restructure its debt. Yanggo Longking is the parent of cash-strapped developer Yango Group.
The move is a concrete step by the Chinese government to defuse risks in the real estate market and reinvigorate Yango, Huarong said. REUTERS
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