Thailand's central bank is tightening its rules on property loans amid a rise in nonperforming loans in the sector, Bloomberg News and Reuters reported.

Effective Jan. 1, 2019, the Bank of Thailand would impose an 80% loan-to-value limit on loans for purchases of new homes worth more than 10 million baht. The same LTV ratio will apply to loans for purchases of second homes, the central bank said.

Further, the central bank would prohibit lenders from extending advances that exceed the value of a property.

The move came amid growing competition in the mortgage sector, which has resulted in a loosening of lending standards. The move is not aimed at putting a break on the property sector, said Bank of Thailand Assistant Governor Wajeetip Pongpech. "We are just lowering the speed," she added.

As of Oct. 4, US$1 was equivalent to 32.68 Thai baht.