- POSTED: 10 Sep 2013 23:51
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China's bank lending picked up in August from the previous month, central bank data showed on Tuesday, but analysts cautioned that credit may still moderate in the coming months.
SHANGHAI: China's bank lending picked up in August from the previous month, central bank data showed on Tuesday, but analysts cautioned that credit may still moderate in the coming months.
Chinese banks extended 711.3 billion yuan ($116.2 billion) in new loans last month, the People's Bank of China said in a statement.
That compares with bank lending of 699.9 billion yuan in July.
The August figure is slightly above market expectations of 710 billion yuan, according to a survey of 11 economists by Dow Jones Newswires.
"Overall, we see stable and robust credit growth," Bank of America Merrill Lynch economist Lu Ting wrote in a research report on Tuesday.
"Looking forward, headline new loans... will likely moderate towards year-end," he said, adding lending traditionally slows at that time on seasonal factors.
A cash crunch in June spooked Chinese financial markets and raised worries over slower loan growth.
"Despite concerns of another liquidity squeeze at quarter-end, we believe the chance of a repeat of the June interbank liquidity squeeze is extremely small," Lu said.
"The (People's Bank of China) will do whatever it can to prevent a possible liquidity squeeze," he added.
The central bank ordered lenders to strengthen liquidity management at the height of the crunch and in late July it injected 17 billion yuan to ease shortages in the banking system.
The brief turmoil in June underscored rising concerns over excessive lending by banks and other weaknesses in China's financial system, including opaque non-bank forms of lending, often called "shadow finance".
Analysts believe the government is keen to crack down on excessive lending as it seeks to rebalance the economy away from traditional big-ticket spending and ensure sustainable economic growth.