Agricultural Bank of China (ABC; 601288.SH, 1288.HK) has frozen all further lending to property developers after officials noticed a spike in lending this year, Bloomberg reported, citing anonymous sources. The freeze was implemented in an order distributed to branches on August 23. This came as bank officials discovered that loans to property developers had risen by 28% in the first half of 2010, outstripping lending by other large Chinese banks. ABC is conducting a review of its books, and the freeze is expected to be lifted at the end of the month. News of the freeze is likely to intensify concerns about banks’ exposure to the property sector. In April Beijing accelerated a crackdown on property speculation, and last month it conducted private stress tests on large banks to determine the impact of a possible fall in property prices.
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