(Bloomberg) -- China Vanke Co. said it will receive 7.8 billion yuan ($1.1 billion) of bank loans guaranteed by its units, an effort to “meet business operations needs,” as the cash-strained developer seeks to avoid a default. 

Vanke subsidiary Shenzhen Yili Real Estate Development Co. provided a guarantee for a 4.49 billion yuan loan, according to a company filing Friday. Another unit, Shenzhen Zhongke Wanxin Industrial Co., issued a guarantee for a 3.29 billion yuan loan. 

The Shenzhen-based company is also applying for a 1 billion yuan loan from banks, to be guaranteed by real estate assets held by a fully owned subsidiary in the city, according to the filing. 

Once thought to be among the safer companies in China’s beleaguered property sector, state-backed Vanke is one of the largest developers hit by a slump in property sales and mounting debt. A potential payment default by Vanke could wreak havoc on investors’ and home-buyers’ confidence in the sector. 

Vanke’s shares and bond prices have soared in recent days as it has sought to reassure the market with new bank credit lines. A slew of recent funding from Chinese banks has totaled nearly $4 billion — including a 20 billion yuan syndicated loan from banks including China Merchants Bank Co. 

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