China banks heed call to step up lending

Credit has been growing since the middle of the year, benefiting mainly the agricultural sector, small enterprises and energy conservation and pollution reduction projects, the China Banking Regulatory Commission (CBRC) said.

The statement on the CBRC’s website, posted over the weekend, did not give a figure for the growing lending.

Both the CBRC and the central bank issued notes last week calling for more loans to boost the national economy amid signs of a slowdown.

The world’s fourth biggest economy grew 10.4 percent in the first half and 10.1 percent in the second quarter, down from 11.9 percent for all of 2007.

The slowdown has led to the government making a subtle policy shift from preventing economic overheating to ensuring steady growth.

The central bank last month raised this year’s quota of new yuan loans by five percent.

The previous cap was widely understood to be no more than 3.63 trillion yuan (US$530 billion), the same amount as was lent in 2007, as the government intended to curb the country’s runaway inflation with a tight monetary policy.

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