Wang Jianxi, executive vice president of China Investment Corp., the country's $300 billion sovereign wealth fund, said Friday he does not see a strong possibility of a default on bonds issued by Fannie Mae and Freddie Mac.
Wang made the remarks on the sidelines of the Chinese People's Political Consultative Conference, the country's top political advisory body.
He did not offer details.
According to Caijing magazine, China Investment, China's State Administration of Foreign Exchange and some Chinese commercial banks are the largest overseas investors in bonds issued by U.S. government-backed Fannie and Freddie.
China's foreign exchange regulator said last month that the U.S. will continue to provide adequate capital to Fannie and Freddie so that they can meet their debt obligations.
The Obama administration last month issued a white paper with proposals to gradually phase out the housing giants.
Concerns have been raised by some analysts in China recently that the reform plans could lead to losses on China's significant holdings of bonds and asset-backed securities issued by the two companies.
But China's foreign exchange regulator has strongly denied it stands to face any losses.
