<div><p>Fresh evidence emerged Tuesday that Chinese authorities had ordered several banks to stop issuing new loans this month as fears grow that the extra money is fuelling inflation.</p><p>Credit Suisse said in a research note that six banks had confirmed new lending had been suspended from January 19 after an emergency meeting by the central bank?s monetary policy bureau. It didn't name the banks.</p><p>There are growing concerns in Beijing that speculators are taking advantage of the money sloshing around the markets, which could cause stock or property bubbles.</p><p>The report came as a China Citic Bank employee, speaking on condition of anonymity, told Dow Jones Newswires the central People's bank of China had told it to halt new loans because it had reached its January quota.</p><p>"The People's Bank of China and the (bank's) headquarters have told us to control the pace of lending this year," he was quoted as saying, adding that the order appeared to be directed at the bank's Shanghai offices.</p><p>"Our headquarters hasn't asked branches across the country to suspend lending," he added.</p><p>Officials at the medium-sized lender were not available to comment when AFP called.</p><p>A spokesman for Bank of China, the country's largest foreign exchange bank, declined to say whether it had been told to suspend giving out new loans.</p><p>However, it said authorities wanted to "rebalance monthly and quarterly lending as much as possible" after a large amount of credit was extended in the first 20 days of January.</p><p>New loans at Chinese banks totalled 9.6 trillion yuan (1.40 trillion dollars) last year -- nearly double the 2008 figure.</p><p>The banking regulator has set this year's target at about 7.5 trillion yuan and in the first two weeks of January new loans totalled 1.1 trillion yuan -- in line with the surge in lending at the start of last year.</p><p>However, the latest data shows the pace of lending far exceeds the average over the past decade, Credit Suisse analyst Tao Dong said.</p><p>On Thursday official data showed the economy grew 8.7 percent last year and 10.7 percent in the fourth quarter thanks to government stimulus spending and Beijing's calls to banks to boost lending to get people spending.</p><p>It also showed inflation at 1.9 percent in December, the highest for 13 months.</p><p>Liu Mingkang, chairman of the China Banking Regulatory Commission, last week denied state media reports that banks had been ordered to stop lending for the rest of January.</p><p>"I've made it very clear about bank lending. We have never asked the banks to stop lending," he said.</p><p>However, Industrial and Commercial Bank of China, the country's largest lender, also ordered its Beijing branches on Friday not to issue new loans for the rest the month, Dow Jones reported, citing an unnamed person with direct knowledge of the matter.</p><p>Officials at ICBC were also not immediately available for comment.</p><p>"The People's Bank of China launched more aggressive quantitative tightening than we previously have thought," Credit Suisse analyst Tao said, adding new monthly lending quotas were likely.</p><p>"Beijing will keep a close eye on lending activities. The State Council is watching the lending figures on a daily basis, instead of the usual monthly basis."</p><img src="http://admatch-syndication.mochila.com/images/ad.gif?aid=67814826&bid=informcom" /></div><div id="copyright"><div>

Copyright 2010  <a href="http://www.afp.com/english/links/?pid=copyright">AFP Global Edition</a></div></div>