New bank loans to top $1.1 trillion in January

New bank loans issued by China's commercial banks in Jan., 2011 may top 1.1 trillion yuan (around 168 billion U.S. dollars,) Shanghai-based Orient Securities estimated in a report.

Judging from the situations of previous years, credit expansion in January would account for 13 to 18 percent of the year's total amount, the company said.

Compared to the new bank loans in Jan. 2010 that totaled 1.39 trillion yuan, last month's lending issuance showed a dramatic slump, showing the initial effect of the central bank's prudent monetary policy.

People's Bank of China, the country's central bank, said in a report released in the forth quarter of 2010 that credit expansion should meet the major target of social and economic development and take the goals of economic growth and inflation control into consideration.

New bank loans in February would see a considerable contract, predicted some analysts.

On Feb. 8, the central bank announced the first rate hike in 2011. However, the possibility of further deposit reserve ratio adjustments are not lessened. Higher deposit reserve ratio would help to control liquidity and inflation expectations, experts said.

By People's Daily Online