in order to create a certain kind of tenancy and leasing market for the housing industry, and in order to ensure the housing mortgage loans be backed by indisputable securities, the real estate developers must utilize equity financing as the main form. as the real estate industry is a high - risk as well as a high - return industry, the problem of matching risks and returns shall only be better resolved with equity financing mode taking the dominant position. according to information provided by the report on china ’ s real estate market 2003 ~ 2004, the leverage ratios of china ’ s real estate enterprises are relatively high. the leverage ratios of the top five listed companies in hong kong are basically kept at a level between 30 % to 40 %, while those of domestic real estate companies stand at around 75 %. the report also shows that among the 24. 6 % of the self - raised capital 13. 3 % belongs to self - owned capital. such a high leverage ratio could bring huge loss to debtors once the market risks arise. according to the report, the return on self - owned capital is 21. 17 %, which does not match the risk borne by debtors when compared to the cost of financing. with the maturing of financial markets, the principle of matching risks with returns shall be absorbed into the financing mode for real estate industry, and it is an inevitable trend that the ratio of developers ’ equity financing will be increased. china ’ s economy is now in a transition period when many reforms are not compatible with each other perfectly. when we put forward the reform of housing commercialization and monetarization, the state reduced or halted direct input into the housing industry but failed to open the equity - financing channel to real estate developers. a multi - level capital market has not developed not only to real estate developers but also to all the enterprises, leading to the result that many enterprise flocked to get listed in the stock market. if they did not succeed in the direct financing market but have to develop, the financing burden thus completely falls on banks. in order to support the housing monetarization reform and promote the development of the real estate industry, the people ’ s bank of china has issued a series of credit policies to contribute to the development of real estate credit since 1998. the rapid development of the real estate industry should be a benefactor of the housing credit policy formulated by the pbc, otherwise the real estate industry shall not be so sensitive to the adjustment of the pbc ’ credit policy.

##demic containment to render policy support to the public ; some made arrangements for fund allocation to shore up supply ; and some opened up green channels to deliver unimpeded services. we rolled out 30 financial support measures, cut the required reserve ratio ( rrr ) three times and launched rmb300 billion lowcost special central bank lending as well as rmb500 billion central bank lending and central bank discounts for the resumption of work and production, to name a few. fighting in solidarity with the people nationwide, the pbc staff spared no efforts to win the fight against the pandemic. now we have managed to achieve the objectives of our monetary policy and china is the only major economy in the world with positive economic growth throughout the year. our endeavors are widely recognized by the financial markets and all sectors of society and are highly appreciated by international organizations and the international community at large. we have always been concerned about the well - being of micro and small businesses ( msbs ), self - employed businesses and other market entities. affected by the pandemic, many msbs faced surging pressures for survival. they are the source of income for millions of families. they fuel the vitality of the market economy and safeguard the national economy and the people ’ s livelihood. holding fast to the two unwavering commitments, we delivered full support to stabilizing businesses and securing employment, increased rmb1 trillion quotas for inclusive central bank lending and central bank discounts, launched two new monetary policy tools providing direct support for the real economy, continuously unleashed the benefits of the loan prime rate ( lpr ) reform, rolled out a mix of measures to enable banks to increase credit 1 / 2 bis central bankers'speeches supply, prompted financial institutions to cut profits in favor of their clients as appropriate and went all out to reduce the financing cost of the real economy. up to now, banks have deferred repayments on more than rmb6 trillion worth of loans and issued over rmb3 trillion unsecured inclusive msb loans, which benefited more than 30 million business entities. the financial sector has achieved the goal of cutting rmb1. 5 trillion worth of profits in favor of the real economy. we pushed forward with the reform and opening - up of the financial sector and were determined to win the three critical battles. the pbc staff studied the guidelines of the fifth plenary session of the 19th cpc central committee and the 2020 central economic work conference,