China’s new bank loans rebounded more than expected in Aug, nearly quadrupling from Jul
DATA MACRO
China’s new bank loans rebounded more than expected in Aug, nearly quadrupling from Jul
DATA MACRO

China’s new bank loans rebounded more than expected in Aug, nearly quadrupling from Jul

 

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China’s new bank loans rebounded more than expected in August, nearly quadrupling from the lowest level since 2009 seen in July, and the overall credit growth also picked up, as the authority sought to shore up economic growth amid soft demand at home and abroad.

Chinese banks extended 1.36 trillion yuan of new loans in August, according to data released by the People’s Bank of China (PBOC), surging from the 345.9 billion yuan in the previous month and above 1.275 trillion yuan expected by analysts in a Reuters poll. The new loans were higher than 1.25 trillion yuan in August last year.

Household loans, including home mortgages, returned to growth in August, rising to 392.2 billion yuan, compared to a contraction of 200.7 billion yuan in the previous month, and that included 232 billion yuan of short-term loans and 160.2 billion yuan of medium- and long-term loans, showed the data.

Corporate loans increased to 948.8 billion yuan from 237.8 billion yuan in July, according to the PBOC.

Outstanding yuan loans grew 11.1% in August from a year earlier, which was in line with expectations and matched growth in July.

China’s M2 money supply grew by 10.6% in August from a year earlier, according to the data, compared to the 10.7% growth in July and below estimates of 10.7% forecast in the Reuters poll.

Annual growth of outstanding total social financing (TSF), a broad measure of credit and liquidity in the economy, quickened to 9.0% in August from a year earlier and from 8.9% in July.

TSF includes off-balance sheet forms of financing that exist outside the conventional bank lending system, such as initial public offerings, loans from trust companies and bond sales.

In August, TSF rose to 3.12 trillion yuan from 528.2 billion yuan in July. Analysts polled by Reuters had expected August TSF of 2.46 trillion yuan.

In breakdown, net financing by corporate bonds reached 269.8 billion yuan, 118.6 billion yuan more than a year earlier, while net financing by government bonds reached 1.18 trillion yuan, an increase of 871.4 billion yuan from a year earlier, according to the data.