MNI 5 THINGS: China TSF Hits 8-month High in September

     BEIJING (MNI) - The following are the key points from China's September

money supply and credit growth data, released by the People's Bank of China on

Wednesday:

     - Total social financing (TSF), a broad measure of credit and liquidity in

the economy, rose to an eight-month high of CNY2.21 trillion in September, much

higher than the MNI median projection of CNY1.38 trillion and up from CNY1.52

trillion in August. The sharp increase is mainly due to a change in calculation

method - as of September, local government bonds are now included in the TSF

calculation.

     - Corporate bonds saw a dramatic slump in September, plunging to CNY8.7

billion from CNY337.6 billion in August, due to a higher number of bond defaults

and lower risk appetite among banks.

     - Shadow banking finance contracted at a faster pace in September, as

regulators continue to tighten their grip. Trust loans, entrusted loans and

undiscounted bankers' acceptances together decreased by CNY289.0 billion,

following a decline of CNY267.4 billion in August. Within this total however,

there was a slowdown in the contraction of bankers' acceptances, which decreased

by CNY54.6 billion in September after a drop of CNY77.9 billion in August

     - New loans increased CNY1.38 trillion in September, beating the MNI

analyst survey median forecast of CNY1.3 trillion and rising from August's

CNY1.28 trillion gain.

     - M2 grew by 8.3% y/y in September, registering in line with the MNI survey

median and accelerating slightly from August's 8.2% y/y, indicating a marginal

expansion of liquidity. M1 growth also inched higher, rising to 4.0% y/y in

September from 3.9% y/y in August.

--MNI Beijing Bureau; +86 (10) 8532 5998; email: marissa.wang@marketnews.com

--MNI Beijing Bureau; +86 (10) 8532-5998; email: wanxia.lin@marketnews.com

--MNI Beijing Bureau; tel: +86 (10) 8532-5998; email: flora.guo@marketnews.com

--MNI London Bureau; +44 207-862-7489; email: ukeditorial@marketnews.com

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