SHANGHAI: China's bank lending more than doubled to 1.47 trillion yuan ($235 billion) in January from December, the central bank said Friday, with analysts citing seasonal factors and monetary easing.
In December, domestic banks extended new loans of 697.3 billion yuan, previous figures showed.
Analysts attributed the surge to the tendency of banks to lend at the beginning of the year after obtaining fresh quotas. China's central bank allots annual loan quotas to financial institutions in order to keep overall liquidity in check.
"The jump from December largely reflects the usual seasonal pattern," Julian Evans-Pritchard, China economist for Capital Economics, said in a research note.
"Bank lending is almost always strongest at the start of each year, when banks receive fresh loan quotas."
A "slightly more accommodative" monetary policy stance had also continued to support bank lending, he said.
The People's Bank of China (PBoC), the central bank, cut deposit and lending rates in November to facilitate credit expansion and boost the economy.
Last week, it lowered the reserve requirement ratio, the amount of money banks must put aside as reserves, to encourage lending.
However, analysts said more monetary easing is needed to support the economy, citing banks' reluctance to lend to small firms.
"Chinese commercial banks have accelerated credit extension on monetary easing," ANZ Bank said in a research note.
"However, the issue remains that Chinese commercial banks are reluctant to lend to specific sectors... To make the RRR (reserve requirement ratio) cut more effective, the PBoC will need to cut interest rates further," the note said.
The central bank also said Friday that total social financing -- a broader measure of credit in the economy -- hit 2.05 trillion yuan for January, in line with a median forecast of 2.1 trillion yuan in a survey by Bloomberg News.
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