NDRC to back bond financing for real estate enterprises
To qualify, the real estate firm must have more than 150 billion yuan in assets and an asset-liability ratio not in excess of 85%
Real estate enterprises with an operating income of more than 30 billion yuan (US$4.36 billion) will now be allowed to issue bonds for financing, according to a new policy released by the National Development and Reform Commission, The Paper reported.
For real estate companies which aim for bond financing, their total assets should be more than 150 billion yuan and the asset-liability ratio should not exceed 85%, according to the new rule.
For companies whose credit rating reaches AAA or feature financial indicators that lead the industry, and, with no bond defaults in the past three years, the NDRC will also give priority to their application.
The new rule also states that enterprises are prohibited from lending the funds to others for real state investment. These funds cannot be invested in industries with excess capacity or in stock and futures trading that is not related to the operation of the enterprise.