In Depth: Why China’s Project Whitelists Can’t Cure Real Estate Slump

China’s cash-strapped property developers have been thrown a financial lifeline by the government through a new strategy — putting eligible housing projects on whitelists compiled by local authorities to help them get bank loans.

But the policy is creating tension between officials desperate to rescue their stagnant local property markets and financial institutions, who are under political pressure to hand out credit but are worried that lending to projects in a depressed market is high-risk and could saddle them with more nonperforming loans.