Central Bank says property exposure won't disrupt financial market

China's financial market is unlikely to be disrupted in the medium to long term by risk exposure of some property developers, and the financial regulatory bodies will keep watch on the debt issue, the central bank said on Friday.

The comment was published on the website of People's Bank of China, the central bank, after Evergrande Group said that it may be unable to meet guarantee obligation of $260 million in offshore US dollar bond market.

"Evergrande's problem was mainly caused by its own mismanagement and break-neck expansion," said the PBOC. "The overseas US dollar bond market is quite mature with well-defined legal provisions and procedures on how to deal with relevant issues and its investors are good at risk identification."

China is committed to creating a level-playing field and advancing the two-way opening-up of its financial markets, the central bank said in a statement.

The risks caused by a certain individual property developer in the short term will not undermine the fund-raising function of the market for the medium and long run, the statement said.

Housing sales, land purchases and financing have already returned to normal in China, as some Chinese property developers started to buy back their overseas bonds, while some investors returned to hold dollar bonds issued by Chinese property developers, it said.

Regulators will support companies which would like to make outward remittances for debt repayment or bond buy-back purposes in accordance with the existing policy framework, according to the PBOC.