By Xin Zhiming (China Daily)
Updated: 2007-12-11 09:46

Yuan lending by Chinese banks slowed in November under tightening measures designed to rein in growth.

Yuan-denominated loans increased 17.03 percent in November year-on-year - 0.63 of a percentage point lower than last month.

China's broad M2 money supply grew 18.45 percent year-on-year in November, also slightly lower than the past two months, the central bank said yesterday.

New yuan loans in November amounted to 87.4 billion yuan ($11.81 billion), compared with 136.1 billion yuan in October, and 283.5 billion yuan in September, marking a continual downward trend.

Chinese banks tend to extend more loans in the early months of the year, but are often ordered to make cuts when overall loans exceed the limit set by regulators.

Banks granted 3.58 trillion yuan in new loans in the first 11 months of the year, compared with 3.18 trillion for all of 2006, indicating there is still ample liquidity in the market, analysts said.

"Credit growth showed visible deceleration in November amid the credit tightening measures, but money supply growth remained strong," said Liang Hong and Song Yu from Goldman Sachs.