| Fresh lending tops 500b yuan in September |
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| Thursday,October 15,2009 Posted: 15:34 BJT(0734 GMT) China Daily |
Fresh lending by banks in September breached the 500-billion-yuan ($73.24 billion)mark, beating economists' estimates, and just over a 100 billion yuan more than what the lenders funneled out in August, according to China's central bank.
Banks loaned 516.7 billion yuan in September, up from 410.4 billion yuan in August, ahead of the estimated range of between 300 billion and 400 billion yuan for last month.
Money supply also expanded faster than forecast. Annual growth in M2, the broadest measure of money supply, accelerated to 29.3 percent in September from a year earlier, up from 28.5 percent in August, the People's Bank of China revealed on its website.
The nation's unprecedented lending surge this year has supported economic recovery, but has also fueled concerns over asset bubbles, mounting bad loans and inflation.
Even so, the government has repeatedly pledged to keep expansionary policies unchanged to consolidate the recovery.
The most recent assertion of status quo came from the chairman of the China Banking Regulatory Commission. "It's far too early to talk about an exit strategy," Liu Mingkang, the regulatory head, said in Hong Kong last Friday.
"The government's emphasis is still on maintaining growth," David Cohen, an economist with Action Economics, was quoted by Bloomberg. "Policymakers will be keeping a wary eye on potential asset bubbles, but they are not an imminent danger."
Market analysts are confident the rise seen in lending last month would help boost China's stock market, whose volatile movements over the last two months were largely a result of investor concern regarding shrinking bank lending.
Growth in fresh lending dipped in July and August after the government stepped up scrutiny of loans and bank assets in an effort to stem non-performing loans and asset bubbles.
"The surge in bank loans in September will effectively beef up people's confidence in improved market liquidity and stronger economic growth," said Xiang Weida, an analyst with Great Wall Securities.
Bank lending in the first nine months totaled 8.67 trillion yuan, far exceeding the government's initial target of 5 trillion yuan for the year.
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