The nation's top economic regulator allowed 40 companies to raise debt from overseas markets in July as part of its efforts to stabilize foreign debt issuance and avoid introduction of steps that would curb the fundraising needs of property developers.

"The government does have a set of standards for debt issues by property developers and local government lending facilities, but the standards, in terms of companies' credit rating and asset qualities, have not been set significantly higher than that in the domestic bond market," sources familiar with the matter said.

In July, 40 companies received government approval, almost twice the number compared to the same period last year, including real estate developers that have been regarded as risky sectors.

The permission came at a time when market participants have raised concerns about the tightening trend for offshore debt, particularly for property firms.

The National Development and Reform Commission, the regulator for foreign debt issuance, issued a slew of guidelines since late last year to control risks after the sector witnessed an aggressive buying spree in foreign markets.

In an earlier announcement made in July, the commission said real estate firms should issue new dollar-denominated bonds to repay debt, without further elaborating the criteria.

The latest announcement of granting approvals for debt issuance will help dispel some worries that the government was planning a ban on offshore debt issuance by real estate firms, as some bankers with Chinese brokerages said property developers have refrained from seeking financing by issuing debt in offshore markets since earlier this year, in the absence of clear policy signals.

"We waited for nearly a year for approval and finally gave up because the borrowing costs were higher than when we submitted the documents," said a banker with a Chinese brokerage, who declined to be identified.

The banker said 364-day bond issuances, which do not need prior approval from the regulator, are a feasible option for property firms to get financing, but companies need to hedge risks between fluctuating interest rates and yuan exchange rates.

Cao Xiao, an economics professor at the Shanghai University of Finance, said the government does not need to put too much restrictions for investment projects if the overall financial risks are under control.

In response to China Daily's interview request, the commission said the government will not close the funding channel for 364-day bond issuance, and will not ban companies from issuing offshore debt.