Beijing is maintaining its tight grip on banks' lending quotas despite growing expectation of monetary easing and calls to phase out the regulators' administrative intervention into banks' operations.
Banks are still not being allowed to grant credit to clients more quickly, though they hope to accelerate loan approvals amid huge demand for financing following harsh monetary tightening last year.
According to two bankers in charge of loan-application assessments, banks have to maintain the slow approval pace that began last year, though they expect it highly likely the regulators will loosen controls on loan issuance.
'There are no signs that we can freely give credit to quality clients in bad need of banking loans,' said a China Construction Bank official. 'The [People's Bank of China] is still wielding its influence on lenders' business practices through administrative procedures.'
The central bank is planning to allow the biggest lenders to increase new loans by 5 per cent in the first quarter, a move that it is believed will benefit cash-hungry businesses and individuals who were shut out from banks last year as Beijing forced lenders to control credit, amid monetary tightening.
Beijing uses lending quotas as a monetary policy tool for macroeconomic control, hampering banks' business development.