China Big Four Banks March New Loans Seen at CNY295Bln


China’s biggest four lenders extended 294.6 billion yuan in new loans, the 21st Economic Herald reported, quoting sources close to the state-owned banks.

In the first 11 days of the month, new loans given out by the four banks stood only at less than 20 billion yuan, according to the report.

The big four lenders are Industrial &Commercial Bank of China, China Construction Bank, Agricultural Bank of China and Bank of China.

At the same time, deposits in the four banks swelled by 2.25 trillion yuan, far from the new deposits of 670 billion in February.

China International Capital Corporation (CICC) estimates that if the big four banks account for 35-38 percent of the industry’s total new loans (the proportion was 36.5 percent in February), total new loans in March may amount to 770 billion to 840 billion yuan, and most probably exceed 800 billion.

That compares with a previous forecast of 700-800 billion, CICC said.

Supplies of new loans in the second quarter may be eased, pushing monthly new loans to 800 billion in the three months to an average of 700 billion in the first quarter.

However, the improvement in credit will cost banks’ profitability, and even an asymmetrical cut in interest rates could also be hardly ruled out, according to CICC.


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