(Add context, analyst quote)
BEIJING, March 10 The number of new yuan loans
made by Chinese banks halved in February and liquidity in the
economy tightened, official data showed on Monday, which
analysts said indicated the previous month's surge was not a
sign of a policy shift.
New bank loans totalled 644.5 billion yuan ($105 billion) in
February, the People's Bank of China said, down from 1.3
trillion yuan in January and below market forecasts of 716
Total social financing, a broad measure of liquidity and
credit, fell sharply to 938.7 billion yuan from January's 2.58
"They stabilised monetary policy and this is having an
effect on demand for loans," said Tim Condon, head of Asia
research for ING Financial Markets in Singapore.
"The whole thing is hanging together."
M2 money supply grew 13.3 percent in February from a year
earlier, in line with forecasts. Outstanding yuan loans were
14.2 percent higher than a year earlier, also in line with
Chinese data in January and February can be distorted by the
timing of the Lunar New Year holidays, which fell mainly in
February this year, and as banks try to grab market share.
Still, January's bank lending spike to 1.3 trillion yuan --
more than double the December level and the largest in four
years -- was seemingly at odds with signs of tapering growth
momentum and efforts by authorities to contain credit in money
Chester Liaw, an economist at Forecast Pte in Singapore,
said the decline in bank loans was a sign that policymakers were
still trying to rein in unregulated lending.
"The drop suggests that the authorities fight against shadow
banking is quickly gaining steam," he said.
($1 = 6.1260 Chinese yuan)
(Reporting by Adam Rose and Jonathan Standing; Editing by John