SHANGHAI, March 4 – China\’s banks extended about 800 billion yuan (117 billion dollars) in new loans in February as they heeded government calls to prop up the slowing economy, Chinese media reported on Wednesday.
New local-currency lending in the first two months of this year amounted to approximately 2.4 trillion yuan, the China Business News reported, citing Wang Weiqiang, chairman of ICBC International Capital\’s board of supervisors.
The February figure represented about half of the 1.6 trillion yuan recorded in January, but more than triple the new lending of 243.4 billion yuan a year earlier.
Some analysts have expressed concerns that some of the borrowed funds from bill financing were placed as term deposits or invested in the stock market for higher returns rather than spent on activities that benefit the real economy.
Increased bank lending is a pillar in China\’s massive four-trillion-yuan stimulus plan aimed at propping up the slowing economy.
Over the next two years, state-owned banks are expected to provide nearly half of the stimulus money through loans.
The economic crisis has hurt China\’s export-driven economy, which grew nine percent in 2008, slipping back into single digits for the first time in six years.
In the final quarter, growth slowed to 6.8 percent.