2010-03-26 14:05

China's four major commercial banks extended new loans amounting to nearly 200 billion yuan ($29 billion) in the first two weeks of March, and the total new lending this month is likely to reach between 800 billion yuan and 1 trillion yuan, the China Securities Journal reported Friday.

An analyst attributed the rapid growth in new lending to strong credit demands by enterprises and the quarterly bank performance appraisal, which usually results in a lending spree during the last month of the quarter as banks try to increase the sums of both lending and deposits by extending more loans.

If commercial banks continue the lending momentum in the last two weeks, the Big Four are likely to extend a total of 400 billion yuan in March, and the banking industry's new lending could amount to more than 1 trillion yuan for the month, the analyst said.

But the analyst noted that there would still be many uncertainties in light of a "balanced lending" requirement by regulators.

Commercial banks are now asked to report their new lending figures on a daily basis, according to the report. "Regulators will keep a close watch on the figures of the last few days of March," the analyst said. "It is possible for regulators to take measures such as window guidance to curb excessive growth of credit should there be any sign of a lending spree."

Jiang Jianqing, chairman of Industrial and Commercial Bank of China (ICBC), said earlier that the bank's new lending remained stable in March.

Statistics showed that ICBC, the world's largest bank by market capitalization, extended about 90 billion yuan in new loans in the first two weeks of March, surpassing the total amount of new credit worth 78 billion yuan it granted in February, the report said.

New lending by the other three banks – Agricultural Bank of China, Bank of China, and China Construction Bank – all reached around 30 billion yuan in the first two weeks of the month.