China bank loans surge

Shanghai - China's bank lending surged in March from the previous month, the central bank said on Tuesday, but analysts dismissed the possibility of monetary easing.

Domestic banks granted 1.05trn yuan ($168.7bn) in new loans last month, down 12.4bn yuan from a year earlier, the People's Bank of China (Pboc) said in a statement.

The March lending figure compared with 644.5bn yuan for February and came in slightly above a median forecast of 1trn yuan, according to a poll of 16 economists by the Wall Street Journal.

But analysts denied it was a sign of monetary easing that some had hoped the government would take to bolster economic growth, which may have slowed to 7.3% in the first quarter according to an AFP survey.

"The surge in new loans does not mark a shift in policy stance but rather reflects the usual seasonal pattern in March, when loan officers boost lending ahead of quarterly financial reports," Julian Evans-Pritchard, China economist for Capital Economics, wrote in a report on Tuesday.

"Despite a surge in bank loans and relatively loose interbank liquidity conditions in March, today's data show that the credit slowdown is still on track."

Growth of outstanding bank loans slowed to 13.9% year-on-year at the end of March from 14.2% in February, according to the Pboc statement.

Total social financing, a broader measure of credit, stood at 2.07trn yuan for March, down 479.4bn yuan from the same month last year, it said.

The central bank also announced that China's foreign exchange reserves reached $3.95trn as of end-March, up from $3.82trn at the end of 2013.