BANKS in Shenzhen have once again taken action to tighten housing loan regulations, withdrawing illegal loans that have flown into the city’s property market, Shenzhen Economic Daily reported Saturday.

Several banks told the Daily that they are thoroughly investigating the illegal inflow of credit funds into the real estate market.

According to an anonymous executive in a local commercial bank, their bank is carrying out an inspection on existing loans. For individual business and consumer loans with an abnormal capital flow, the default customers are required to immediately repay the bank’s loans in advance and terminate their credit limit.

Since March 9, some banks in Shenzhen have conducted self-examination on credit funds illegally flowing into the property market, requiring customers to return them in advance.

“Once it is found that the business loans have illegally flown into the property market, our bank will immediately recover the loans, with some corresponding penalty measures. Recently, there have been several such cases reported,” a staffer with a local commercial bank was quoted as saying.

Other undisclosed commercial banks said that they will further strictly implement supervision requirements such as the centralized management system of real estate loans.

According to these banks, they will ensure that the whole process of issuing business and consumer loans strictly follow the requirements of the internal control system, and put the risk prevention and control systems in place.

However, State-owned banks are relatively cautious, saying that they “will wait for the guidance of supervisory authorities before making specific moves.” (Zhang Yu)