Lending targets curtailed

Just 3 days ago (26 July) we discussed expectations for pinpointed measures to prevent over lending.

Two of China’s largest banks have set limits of 2009 lending:

1.Industrial and Commercial Bank of China- ICBC (SEHK: 1398) plans to issue new loans of CNY1 trillion over 2009 – to date the bank is 83% towards that target.

2. China Construction Bank – CCB (SEHK: 0939) has set a CNY900bn limit, and is already 79% of the way there.

I see these as sensible measures towards helping sure up the quality of the banks’ loan books.  From a maco perspective it is one more incremental step towards preventing an asset bubble.