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00:00[CC may contain inaccuracies] What was the overall message from the meeting between the banks and their regulators this week. The data is is not great but it's also hard to see how people can borrow when they end up down. Right. Yeah that's right. And companies obviously are suffering. And then there's the trickle down effect and they could song at the state council obviously is concerned about employment. And if companies small to medium sized enterprises are struggling they're not going to be able to pay their wages. So there's a lot of subsidies coming their way from the government. A whole raft of course that we heard about on Monday of some 33 new stimulus measures mostly targeted at small to medium sized enterprises and companies that have been hammered. Absolutely. By these lockdowns and other pandemic restrictions across the country. But now we are learning from state media yesterday that there was on Monday another meeting between E. Gang the BBC governor as well as representatives of the CRC the banking regulator essentially instructing the big major financial institutions. Twenty four of them were represented at that meeting on Monday telling them you got to lend more. You absolutely have to lend more because look lending as we all know in April fell off the cliff. I think the total number of new U on loans was about five times lower than what we saw in March. And we have a bar chart on that. You can see this. The precipitous fall off in New York on loans in April and May is not shaping up to be much better. But you can understand given the pain in the economy right now with GDP expectations being ratcheted down almost on a weekly basis UBS the latest one to ratchet down their full year GDP forecast to 3 percent. Bloomberg Economics says 2 percent. Second quarter the current second quarter likely in contraction. You can understand why many of these big banks unless they're absolutely told to they're kind of hesitant right now to do a slew of new lending because their risk appetite is a little bit weak right now.

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China’s Central Bank, Regulator Urge Banks to Boost Lending

The People’s Bank of China and the nation's banking regulator are urging lenders to boost loans as the economy continues to get battered by pandemic controls. Stephen Engle reports on "Bloomberg Daybreak: Asia." (Source: Bloomberg)

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