China's new loans hit 738.1 bln yuan in January

BEIJING, Feb. 10 (Xinhua) -- The People's Bank of China (PBOC), the central bank, said on Friday that the nation's new yuan-denominated lending reached 738.1 billion yuan (117.28 billion U.S. dollars) in January, down 288.2 billion yuan year-on-year.

The lower-than-expected figure for new lending was below the 1-trillion-yuan growth predicted by many economists but higher than 640.5 billion yuan in December last year.

By the end of January, the outstanding broad money supply (M2), which covers cash in circulation and all deposits, rose 12.4 percent year-on-year to 85.58 trillion yuan, the PBOC said in a statement on its website.

M2 growth in January was 1.2 percentage points slower than that seen at the end of last year, according to the statement.

The narrow measure of money supply (M1), which covers cash in circulation plus demand deposits, rose 3.1 percent year-on-year to 26.99 trillion yuan by the end of last month, the statement said.

Chinese banks tend to grant more loans in January than any other month to lock in profits as early as possible from policy changes amid the central bank's credit tightening over the past two years.

"The new loans in January all exceeded 1 trillion yuan from 2009 to 2011, so the new lending in January this year was at a relatively low level," said E Yongjian, a financial researcher from Bank of Communications, one of China's leading lenders.