China bank lend­ing up in July

The Pak Banker - - COMPANIES/BOSS -

China's bank lend­ing rose in July, the cen­tral bank said Tues­day, as money poured into a mas­sive res­cue for the coun­try's stock mar­ket.

Do­mes­tic banks ex­tended new loans of 1.48 tril­lion yuan ($238 bil­lion), up from 1.27 tril­lion yuan in June -- al­most twice the es­ti­mate of econ­o­mists sur­veyed by Bloomberg News -the Peo­ple's Bank of China (PBoC) said.

But to­tal so­cial fi­nanc­ing, an al­ter­na­tive mea­sure of credit in the real econ­omy, hit 718.8 bil­lion yuan last month, down from 1.86 tril­lion yuan in June and short of econ­o­mists' forecast of 1.0 tril­lion yuan, ac­cord­ing to Bloomberg.

"China's new yuan loans rose sharply... as stock mar­ket res­cue pol­icy lifted new loans," ANZ econ­o­mists Liu Li-Gang and Louis Lam wrote in re­ac­tion to the data. Author­i­ties have been ag­gres­sively sup­port­ing shares af­ter China's key Shang­hai stock in­dex plunged more than 30 per­cent over three weeks from a June 12 peak be­fore re­bound­ing on the of­fi­cial in­ter­ven­tion mea­sures. For the first seven months of this year, Chi­nese banks ex­tended a to­tal of 8.04 tril­lion yuan in new loans, up 2.15 tril­lion yuan from the same pe­riod last year, the PBoC said. An un­named cen­tral bank of­fi­cial said in a state­ment that gov­ern­ment sup­port for the stock mar­ket was one rea­son for the yearon-year spike.

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