Yuan deposits at China's 'big four' banks drop by 1.5t in July

(ECNS) -- In July, new deposits at China's "big four" banks fell by 1.5 trillion yuan ($240 billion), from a 2.2 trillion yuan growth in June, the Shanghai Securities News reported.

China's "big four" banks -- Bank of China, China Construction Bank, Industrial and Commercial Bank of China and Agricultural Bank of China -- issued a total of 210 billion yuan in new loans in July, down from 290 billion yuan in June.

New loans issued by all Chinese lenders in July are expected to be less than 800 billion yuan. And UBS AG estimated that the number would be 750 billion yuan, which is consistent with previous years.

The drop in new deposits at the four banks in July is big, analysts have said, as there was a surge in deposits at the end of June, when banks try to boost their deposits for the regulatory review on loan-to-deposit ratios.

Deposits at banks typically drop at the beginning of each quarter, and last July also saw a decrease of 589.1 billion yuan in new deposits at the "big four" banks.

Analysts also attributed June's surge in deposits to the increase in government's fiscal allocation and loosened supervision over interbank business.