The credit structure in China has continued to optimize and enhance the momentum of economic development in the first half of the year, according to the relevant person in charge of the central bank. At a press conference held on July 14, the person in charge, including Liu Guoqiang, deputy governor of the People’s Bank of China, provided a detailed analysis of the financial data and addressed various issues related to the credit structure.
Liu Guoqiang emphasized that the monetary policy of China is precise and powerful, with increased counter-cyclical adjustments to promote overall improvement in economic operation. The liquidity is reasonable and sufficient, providing strong support to the real economy. In terms of credit structure, the data showed that RMB loans in China increased by 15.73 trillion yuan in the first half of the year, with new loans to enterprises accounting for 81.5% of the total credit increment. These new loans were mainly invested in key areas such as manufacturing and infrastructure industries, indicating the focus of credit investment.
Furthermore, financial institutions in China have increased their support for key areas and weak links in the national economy, including inclusive finance and technological innovation. The balance of “specialized, special, and new” small and medium enterprise loans increased by 20.4% year-on-year, and the balance of inclusive small and micro loans increased by 26.1% year-on-year. This emphasis on inclusive finance highlights the commitment to supporting all sectors of the economy.
The cost of corporate financing and resident credit has also declined steadily in the first half of the year. The weighted average interest rate of newly issued corporate loans decreased by 25 basis points compared to the previous year, and the weighted average interest rate of newly issued individual housing loans decreased by 107 basis points compared to the previous year. These lower interest rates indicate a favorable environment for borrowing and economic growth.
Despite the positive financial data, the relevant person in charge of the central bank emphasized that there is still sufficient policy space to deal with unexpected challenges. The financial sector has provided targeted support for key areas such as private small and micro enterprises and manufacturing, and has supported the recovery of macroeconomic performance. The power of scientific and technological innovation, green transformation, and consumer market recovery are the driving forces behind high-quality development.
Looking ahead, the People’s Bank of China will continue to implement a sound monetary policy and use various monetary policy tools to maintain reasonable liquidity in the banking system. The goal is to promote a steady decline in the cost of corporate financing and residents’ credit, ensuring a favorable financial environment for economic growth.
Regarding the real estate market, it showed a stable trend in the first half of the year. The issuance of personal housing loans increased significantly, but the balance of personal housing loans declined year-on-year. This was attributed to changes in the price relationship, as residents used deposits or reduced other investments to repay existing loans. The central bank supports and encourages commercial banks to negotiate with borrowers to change contractual agreements or replace existing loans with new ones.
The financial sector will actively cooperate with relevant departments to strengthen policy research and implement policies according to the city to improve the accuracy of real estate financial policies. Recently, the financial management department extended policies applicable to real estate financing to the end of December 2024, providing more support to the sector.
In conclusion, the credit structure in China has continued to optimize and enhance economic development in the first half of the year. The focus of credit investment has been on key sectors such as manufacturing and infrastructure, with increased support for inclusive finance and technological innovation. The cost of corporate financing and resident credit has declined, creating a favorable environment for economic growth. The central bank will continue to implement sound monetary policies and improve real estate financial policies to support economic stability and development.