China new loans seen reaching 800 bln yuan in March

BEIJING, March 31 - Chinese banks continued to lend massive amounts in March, a positive sign for economic recovery, though at a slower pace than in the first two months of the year, BOCOM International said in a report on Tuesday.

Banks lent an estimated 800 billion yuan ($117 billion) in March, the securities arm of the Bank of Communications said.

The same figure was quoted in a report by the Shanghai Securities News on Monday, which cited an unidentified authoritative source.

A Scotia Capital report on Monday estimated that banks had lent 700 billion yuan in March.

These lending totals would be less than 1.62 trillion yuan in January or 1.07 trillion yuan reached in February, but still far above the 283.4 billion yuan lent in March 2008.

People's Bank of China Governor Zhou Xiaochuan said last week that the world's third-largest economy was recovering as Beijing's various stimulus measures registered initial success.

China's target is for banks to lend at least 5 trillion yuan this year to help finance its stimulus spending and keep annual economic growth at 8 percent.

The Shanghai Securities News cited Wu Zhifeng, an economist at the China Development Bank, as saying that new loans could total 6 trillion yuan or even higher this year.

Guo Tianyong, a banking professor in Beijing, told the paper that banks might lend 7-8 trillion yuan in all of 2009. ($1=6.836 Yuan)