China January New Loans Exceed Estimates at 1.07 Trillion Yuan

China’s new local-currency lending was 1.07 trillion yuan ($172 billion) in January and M2 money supply climbed 15.9 percent from a year earlier, the People’s Bank of China said on its website.

Aggregate financing in the month was 2.54 trillion yuan, the central bank said today.

New loans compared with the median 1 trillion yuan estimate in a Bloomberg News survey of 28 economists and 738.1 billion yuan in January 2012. The median forecast for money supply was a gain of 14 percent after a 13.8 percent increase in December and 12.4 percent a year ago.

Estimates of five economists for January aggregate financing ranged from 1.35 trillion yuan to 2 trillion yuan. The figure was 975.4 billion yuan a year earlier.

China’s bank loans as a share of funding in the economy fell to a record low last year, central bank data show, highlighting the growth of alternative financing channels that have prompted warnings of rising credit risks. New yuan bank lending was 8.2 trillion yuan in 2012, accounting for 52 percent of the 15.8 trillion yuan aggregate financing, the least in statistics dating to 2002, when loans had a 91.9 percent share.

The central bank hasn’t publicly stated a target for growth in M2 this year and doesn’t issue a goal for new loans. UBS AG estimates new local-currency lending this year will rise to 8.5 trillion yuan to 9 trillion yuan, while JPMorgan Chase & Co. estimates 9.1 trillion yuan.

To contact the editor responsible for this story: Nerys Avery at navery2@bloomberg.net

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