When contacted by Reuters, a CSRC official denied that a formal suspension was in place, but confirmed that the securities regulator and the land resources ministry were examining whether property firms had illegally manipulated land prices before approving any share issues in the Chinese market.
There was no indication that the suspension would be extended to debt issues or other forms of capital raising by property companies. Many Chinese developers have been selling bonds to raise funds in recent months as banks have tightened lending.
Worried about a potentially destabilizing asset bubble, Beijing has been trying to cool the real estate market, raising mortgage rates and down payment requirements for second homes and pushing local governments to clamp down on speculators.
China’s banking regulator has also issued new guidelines to make it harder for property developers to obtain funding from trust companies, the 21st Century Business Herald quoted an unidentified executive at a trust company as saying.
Reuters stated that, in its report published in the China Economic Times, steps taken in recent months by the government had not yet succeeded in tamping down on surging property prices. It said, "If the controls are not forceful, with our country’s growth and development clearly outstripping that of other countries, hot money inflows will quicken and excessive domestic liquidity will increase, progressively inflating asset bubbles."