China may ease ‘three red lines’ property rules: Bloomberg
China is planning to relax restrictions on borrowing for property developers to support the troubled sector by dialling back the “three red lines” policy, Qazet.az reports citing Bloomberg News.
The “three red lines” policy was unveiled in August 2020 to tackle property developers’ unbridled borrowing by restricting the amount of new borrowing they can raise each year.
Beijing may allow some property firms to add more leverage by easing borrowing caps, and push back the grace period for meeting debt targets set by the policy. Regulators could also extend the deadline by at least six months, which was originally June 30, the report said citing people familiar with the matter.
Under the new proposal, China will ease restrictions on debt growth for developers depending on how many red lines they meet, easing borrowing caps to companies that meet all three thresholds, the report added.