Shadow Banking in China: Implications on Real Estate and the Real Economy
12:00pm Registration/ Networking 12:25pm Luncheon 1:05pm Remarks 2:00pm Close Hosted by the Financial Services Committee and Real Estate Committee In recent years domestic banks in China have turned more cautious towards lending to the real estate sector and bank loans have become increasingly difficult to obtain. As a result, more developers are seeking alternative sources of financing to fund their growth and expansion. One option is to raise debt through the shadow banking market. The shadow banking system in China encompasses a collection of non-bank financial intermediaries which provide services similar to commercial banks but are not subject to the banking regulations. There are a wide range of intermediaries including underground banks, microcredit companies, off-balance sheet loans for domestic banks, private equity funds and trust products. Though the largest shadow banking markets are the United States and United Kingdom, China's shadow banking system has been growing at a tremendous rate.
Recording an increase of 42% in 2012 alone, it is currently estimated to account for as much as US$ 3.5-5 trillion equivalent to 26% - 55% of the country's GDP. With this in mind, will there be more default cases in the Chinese residential markets? How will this impact the overall real estate market? Will this create a knock-on effect on the already slowing economy in China? Please join our lunchtime event to explore these issues and more.
Conrad Hong Kong Hennessy Room (7/F) Pacific Place 88 Queensway Admiralty, Hong Kong