Chinese Banks Lend Like Crazy in First Two Weeks of January

The explanation for now is the cash crunch in December.

China’s Credit Growth Slows as Foreign Reserves Jump
China’s broadest measure of new credit fell in December while money-supply growth and new yuan loans trailed estimates amid a cash crunch and government efforts to curb speculative lending.

Aggregate financing was 1.23 trillion yuan ($204 billion), the People’s Bank of China said today in Beijing. That compared with 1.63 trillion yuan a year earlier. China’s foreign-exchange reserves, the world’s largest, rose to a record $3.82 trillion at the end of December from September’s $3.66 trillion.

China’s shadow banking loans leap
The central bank reported a fall-off in new bank loans in December to Rmb482.5bn, from Rmb624.6bn in November. Jian Chang, an economist at Barclays, noted that loan demand tended to weaken at the end of each year, with last month’s decline reflecting weaker mortgage demand.

This next one is Google Translated.

9 Trillion Yuan Rhythm, Four Big Banks Again See Credit Rebound
Summary: As of January 12, workers and peasants in four rows of about 320 billion yuan new RMB loans, significantly higher than the same period last year 270 billion new; and so focused lending is based on the loss of 550 billion four rows on deposits contrarian completed.

21st Century Business Herald "early lending, early gains," China Banking centralized lending beginning in 2014 tradition still continues.

21st Century Business Herald reporter data obtained from the authorities of the display, as of January 12, workers and peasants in four rows of about 320 billion yuan new RMB loans, significantly higher than the same period last year 270 billion new; and lenders are so focused On the basis of the four deposits contrarian loss of 550 billion on completion.

Strong credit growth, maybe some relationship with 2013 last month forced pressure loans. The market is more concerned about the 2014 Chinese monetary and credit policy towards how.

Reporter interviewed a number of authoritative experts, 2014 is expected to target the gross domestic product (GDP) growth, inflation control, several indicators are likely the intended target line with 2013 or slightly lower, that is, economic growth target will maintained at around 7.5%, the consumer price index (CPI) rose 3.5% in may.

This means that the expected growth of broad money M2 target in 2014 will be around 13%, so the projections, in 2014 the new loans will be down at 9000000000000.

In late November 2013, M2 grew by 14.2%, higher than the previous year an increase of 0.4 percentage points; January to November, RMB loans increased 8.41 trillion yuan, an increase of 660 billion yuan.

Different than in previous years, the January 2014 New Year's Day and Spring Festival set one of two festivals, under the "double" in great capital, liquidity test of China's banking system will be unprecedentedly severe.

"Project reserves, the banks have done enough work." 14, a state-owned big firms Northeast Branch told reporters that he did not agree with the argument rushed loans, project loans had originally planned to put a lot out of the end of 2013, but limited in the amount of control did not put out.

According to the reporter available data, in December 2013 the first three weeks, four lines put up 215 billion yuan of new loans, higher than the average of previous years put on a node; But in the last week, the size and liquidity of the pressure control of under the pressure of the loan the bank had to take the final four lines of new loans in a single month was controlled at 180 billion yuan.

In this way, you can explain the first two weeks of January 2014 credit a more concentrated logic. Credit ferocious, but it does not mean money drain, prudent monetary policy is still the norm.

As reported by the Bank of China macroeconomic thought, "in 2014, the central bank may maintain a prudent monetary policy, the likely maintain prudent monetary policy, M2 year on year growth will remain steady state, estimated annual M2 growth will be 13.5 about%. "

"Our monetary policy from a moderately loose to prudent been more than three years, and this trend will continue." Early January, the CBRC supervision annual meeting requiring commercial banks to recognize the long-term control of monetary aggregates, early to adjust liquidity preference.

"Some banks are still in accordance with the inertia of thinking, the pursuit of high growth scale, high-performance indicators, high value-added profit, not on the use of non-credit facilities to complement, not on the table with the table of foreign make, credit constrained on the influx of Trust, the Trust Restricted securities on the route through the channel is limited and poured into the industry, expansion of the old road still to go. "regulator of commercial banks in recent unreasonable asset-liability management approach criticized.

Double test

But now the war is yet to come fluidity, January 14, the overnight interest rate has been about 2.74 percent since June 2013 a relatively low level of money shortage, whether or seven days SHIBOR collateral repo rate are currently in last November the lowest level since mid degree of inter-bank funds face relaxed exceeded market expectations.

Since June 2013 money shortage crisis, China's banking sector asset and liability management and liquidity risk has become a major proposition regulatory agencies and commercial banks have to take seriously.

CBRC had just concluded annual meeting, the regulators noted that liquidity risk management more difficult to reason from the following several aspects, one of these years in the industry, the rapid development of financial and other services, the proportion of short-term financing in the interbank market significantly increased funding decreased stability; Second, the balance rises with the degree of maturity mismatch.

Changes in asset and liability structure of commercial banks to liquidity management brings considerable challenges. Business on the interbank market response has been very sensitive to the strong volatility, particularly over-reliance on a number of small institutions interbank assets expansion, which is prone to liquidity exports.

Regulators pointed out, from four aspects, strengthen liquidity risk prevention: First, recognize the long-term control of monetary aggregates, early to adjust liquidity preference. The second is to improve the stability of funding sources, to firmly establish the concept of living within our means business assets, strengthen active liability management. The third is to strengthen the financial and investment industry business management, adjust the asset structure, balance the reasonable control of the degree of maturity mismatch. Fourth, earnestly implement the liquidity risk management practices, pay close attention to the currency market trends, good response plans, to discover potential risks, to take decisive countermeasures.

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