Chinese bankers provided domestic borrowers with deferrals for more than USD$1 trillion in loans in 2020, amidst broader policy efforts to keep the economy afloat during the worst of the COVID-19 pandemic.
2020 saw 19.6 trillion yuan (approx. $3.03 trillion) in new loans extended by Chinese banks, as well as deferrals for principal and interest payments on 6.6 trillion yuan (approx. $1.02 trillion) in loans, according to data released by the China Banking and insurance Regulatory Commission (CBIRC) at the start of March.
A total of 24.27 billion yuan ($3.75 billion) in emergency response loans were issued across five Chinese provinces, while new loans to the manufacturing sector totalled 2.2 trillion yuan, a sum greater than all new lending to Chinese manufacturing over the preceding five year period.
New loans to private enterprises totalled 5.7 trillion yuan, for an increase of over 1.5 trillion yuan compared to the preceding year.
According to CBIRC the Chinese banking sector managed to satisfy the goal of “transferring” 1.5 trillion yuan in profits to the real economy in 2020 by reducing the cost of financing for targeted groups.