THE credit risks from local governments' financing platforms and property loans were controlled in 2011, and the China Banking Regulatory Commission will ensure that the risks will be managed strictly this year.

"We will strictly prevent the growing momentum of the risks from local government financing vehicles," the CBRC said in an annual report, laying out its priorities in 2012.

A National Audit Office report has showed that by the end of 2010, local governments' debt totaled 10.72 trillion yuan (US$1.7 trillion), a figure of particular concern as some of them may have borrowed too much and find it hard to repay.

But data have shown that non-performing loans and the proportion of NPLs to gross loans both fell among lenders last year. The NPLs fell to 1.05 trillion yuan last year, and the NPL ratio shed 0.66 percentage point to 1.77 percent from a year earlier.

There were also worries about a possible increase in sour property loans due to the deteriorating domestic real estate market. China's new home prices fell in March for the sixth straight month, the National Statistics Bureau said last week, as the government pledged to keep its tough measures on the market.

But the CBRC said: "The risk level in property loans is falling continuously. We will continue to improve and enhance property loan risk checks."

Source:shanghaidaily