PBOC Urges Not To Focus Overly On Monthly New Loans

The People’s Bank of China has called for a more comprehensive view of monetary and financial conditions instead of simply looking at the scale of credit increase to judge financial support, Caixin reported. The PBOC said in its Q4 monetary-policy report released late Thursday that new loans are subjected to seasonal factors such as assessment of banks, which makes January a significant month compared to April, July and October. Aggregate finance, which covers direct financing, is a better indicator, or observing over a longer period of time by using cumulative credit growth and loan balance growth, the PBOC said. Caixin noted that major banks are required to smooth credit supply throughout the year, compared to the previous pace of completing 40% of annual credit supply in Q1, 30% in Q2, 20% in Q3 and 10% in Q4.