China's property market braced for 30% drop - papers

Standard Chartered has told clients to prepare for a fall in property prices of up to 30% in large Chinese cities as the delayed effects of monetary tightening begin to bite.

Stephen Green, the bank's China economist, said a glut of newly built homes were hitting the market just as buyers are restrained by higher down-payments and curbs on speculation, The Telegraph reports.

"We believe developers will be forced to cut prices," he said.

Kenneth Rogoff, ex-chief economist for the IMF, told Bloomberg Television in Hong Kong that the denouement could prove abrupt after such a torrid boom. "You are starting to see that collapse in property and it is going to hit the banking system," he said.

The Government is trying to deflate the housing market gently, mostly using tools known as "financial repression" rather than Western style rate rises.

Xu Shaoshi, land minister, said sales are already dropping. "In another quarter's time or so, the property market will probably come to a full correction and prices will fall. It is hard to say to what extent they will fall," he said. See story...

AgBank in record $22bn flotation

Agricultural Bank of China is set to raise $22.2bn (£14.6bn) from its initial public offering in Shanghai and Hong Kong, making it the largest flotation ever.

Sources close to the deal said AgBank, China's third-largest bank, was priced at the top of an indicated range at 2.68 yuan per share in Shanghai.

Its Hong Kong-listed shares were priced at HK$3.20, raising $10.5bn. The pricing puts AgBank on course to beat the record $21.9bn IPO by Industrial & Commercial Bank of China in 2006. See story...