China’s central bank boss has acknowledged that deepening problems in the real estate sector and for debt-laden local governments mean the country’s banks will struggle to boost lending enough to bolster economic activity.

Pan Gongsheng, the head of the People’s Bank of China, told a major financial forum in Shanghai this week that lending to real estate and local government financing vehicles accounts for a large share of the country’s 250 trillion yuan ($51.6 trillion) of bank loan books.