Local debt at 9.25t yuan, says CBRC chief

China's local debt level has been decreasing over the past two years and the issue will gradually be resolved, China's top banking regulator said on Thursday.

The total scale of the country's local government debt stood at 9.25 trillion yuan ($1.48 trillion) by the end of September, Shang Fulin, chairman of the China Banking Regulatory Commission, said during a session of the 18th National Congress of the Communist Party of China, which opened on Thursday.

This was the first update on local government debt since the figure of 10.7 trillion yuan was released at the end of 2010.

"The total scale (of local debt) hasn't changed much from the previous year … the current goal is still to control the increments," said Shang.

There has been a change in debt structure, as the majority of debt has been gathered at the provincial level from the city and county level.

Yet he said local governments still have a healthy cash flow of 9 trillion yuan, or 97.3 percent of the total debt, for repaying capability, and “the local debt issue will be solved after some time”.

Shang said the scale of housing loans in China was 11.7 trillion yuan by the end of September, which accounted for 19.09 percent of the country's total loan balances, a level much lower than the global average.

Meanwhile, mortgages account for a small proportion of property purchases, and defaults are rarely seen, he said, adding that housing loans will still be carefully monitored among newly added loans.

The authorities will also strengthen the management of mortgages and the approval of new credit, he said.

In the future, there will be more financial support to encourage purchases of smaller-sized and lower-priced properties, as well as affordable housing projects, Shang said.