Chinese bank lending slows in September

Chinese banks loaned RMB623.2 billion in September, down 11% from RMB703.9 billion in August and below the industry estimate of RMB700 billion.

Total aggregate financing for September reached RMB1.65 trillion, up from RMB1.24 trillion in August.

Analysts said a reason for the slow loan growth was that Chinese banks were resorting to other sources of funding such as “trust loans” that are part of the shadow banking system. Financing from trust loans jumped 71% to RMB202.4 billion in September from RMB118 billion in August.

Other main sources of funds in September were corporate bonds and undiscounted bankers’ acceptances. One analyst said that liquidity isn’t tight but that companies' financing channels have expanded.

Total social financing, a broader measurement of credit in the economy, rose considerably in September to RMB1.65 trillion from RMB1.24 trillion in August, PBOC reported.

Social financing is a relatively new measure, designed to capture funding outside the banking system. It includes loans in RMB and foreign currencies and corporate bonds, trust credits and equity offerings.