THREE commercial banks will be chosen to handle the housing fund program and related financial business which will officially become effective by the end of the year.

Bidding for the commissioned banks started Friday, marking the end of the city's history of not having a unified housing fund, as required by the State Council in 1999, the Southern Metropolitan Daily reported Saturday. Shenzhen was the only major mainland city which did not have a unified housing fund.

The housing and construction bureau said bidding would close in a week with the disclosure of a list of the banks selected by the housing fund management committee, according to the Daily.

The housing fund is a long-term savings program aimed at bolstering home ownership. Under the program, all working residents and their employers would be required to pay monthly installments at a set percentage of their salary into the fund. They can then withdraw money to buy homes.

Account holders would also have access to mortgages with lower interest rates with the commissioned banks than those of other commercial banks.

However, the amount of payment and deposit rates for the housing fund had not been determined, according to the authority. But they won't be less than 5 percent of the average monthly salary of the previous year.

Shenzhen first established a fund in 1992, but the fund covered employees in only a few State-owned enterprises.

Source:Shenzhen Daily