China's Big Four banks lend 53pc more in March on investment boom

New loans doled out by the mainland's Big Four banks surged 53 per cent last month compared to February, underscoring the ample liquidity available to meet the demand of the nation's investment boom.

The four largest lenders extended a total of 331 billion yuan (HK$414 billion) in new loans last month, compared to 216 billion yuan in February and 370 billion yuan in January, the official China Securities Journal reported yesterday, citing unnamed sources.

The aggregate lending of the Big Four - Industrial and Commercial Bank of China, China Construction Bank (CCB), Agricultural Bank of China and Bank of China - usually accounts for 30 to 50 per cent of new bank lending in China.

Economists expect new loans to total one trillion yuan when the People's Bank of China releases national credit figures in the middle of this month.

Lu Ting, an economist at Bank of America Merrill Lynch said: "Bank lending seemed to accelerate from the middle of March, helped by rising deposits and, perhaps, reduced intervention by the central bank after the release of weaker-than-expected growth data in the first two months."

Policymakers have said they will take a "neutral" monetary policy stance this year to balance inflation and an uneven economic recovery.