Chinese regulators, wary of financial risks spreading as a result of their crackdown on property lending, are considering easing the rules to let struggling developers sell off assets to avoid defaults and hits to the broader economy.
Currently, rules put in place late last year to restrict how much property firms can borrow, dubbed the “three red lines” on leverage ratios, are so strict that they have hurt the ability of developers like China Evergrande Group to sell assets to repay debts.