(15 June 2011 – China) New loans issued by Chinese banks fell sharply in May from previous months, in a sign Beijing’s efforts to stem a flood of credit in the economy are bearing fruit.China’s banks handed out 551.6 billion yuan (A$85.14 billion) in loans in May, compared with CNY739.6bn in April, and CNY100.5bn less than a year earlier, the People’s Bank of China (PBOC) said in a statement.
Analysts had expected CNY650bn in new loans, Dow Jones Newswires said.
Policy-makers have been pulling on a variety of levers to rein in bank lending on fears that soaring property prices and inflation – the latter of which has hovered above 5 percent – could trigger social unrest.
The central bank has hiked interest rates and increased the amount of money banks must keep in reserve numerous times in the past year.