China Development Bank (CDB) will support renovation of rundown housing after China's banking regulator announced on Thursday that it had approved the bank to establish a housing finance department.

The China Banking Regulatory Commission said in a statement on its website that the move follows the decision by China's State Council in April to speed up renovation of rundown communities.

CDB will offer long-term funding at reasonable costs to accelerate rundown housing renovation, said a bank official. It will guarantee the capital needs of ongoing and new projects while managing risks.

The bank has so far lent 590.3 billion yuan (94.9 billion U.S. dollars) to renovate communities of 600 million square meters, benefiting 6.7 million households, according to CDB.

Since April, it has given 159.3 billion yuan to renovation projects, 6.3 times as much as the amount in the same period last year.

CDB president Hu Huaibang said in April that the bank would fast-track loans to renovate rundown communities.