Beijing’s most ambitious plan yet to rescue its struggling property sector could be the development investors have been anticipating for months. But the bold steps could pose risks to banks operating in smaller cities, said S&P Global in a report on Monday.
The global ratings agency expects the recent measures, such as lowering down-payment requirements and removing the floor on mortgage rates, could temporarily boost property demand. However, the measure also introduce risks related to leverage, mortgage defaults, and potential challenges for banks in smaller cities.
