CITIC Bank reduces exposure to property

China CITIC Bank (601998.SHA, 0998.HK), the lending unit of the mainland’s biggest investment firm, said it will reduce growth in loans to property developers by at least one-third this year from 2010, South China Morning Post reported. The bank’s loans to the commercial real estate sector grew 65% last year, compared to average growth of 20% in the industry, Michael Werner, a senior analyst at Sanford C. Bernstein in Hong Kong, said. Beijing has issued multiple warnings to banks to reduce their lending to the property sector in order to cool the market. New lending to real estate developers rose by RMB207 billion in the first quarter, down 35% from the previous year, according to Stanley Li Nan, an analyst at Mirae Asset Securities in Hong Kong. CITIC Bank also said its loans to local government financing vehicles fell 11.66% from the previous quarter to RMB104.6 billion at the end of March.