(Yicai Global) Feb. 11 -- China’s new yuan-denominated loans and newly added social financing soared to all-time highs last month, according to central bank figures, as banks front-loaded lending at the start of the year.

New yuan loans reached CNY3.98 trillion (USD625.7 billion) in January, data from the People’s Bank of China showed yesterday, beating market expectations for about CNY3.7 trillion and CNY394.4 billion (USD62 billion) more than a year earlier.

Lending to companies, which rose over 31 percent to CNY3.36 trillion, was the main reason for the jump in new yuan loans, Founder Securities noted. But the new corporate lending was mainly short-term loans and bill financing, with weak growth in medium- and long-term credit, indicating inadequate funding for real estate and infrastructure, it added.

New social financing, or the amount of money the financial system provided to companies and households, also topped expectations, gaining CNY984.2 billion to CNY6.17 trillion, the PBOC’s data showed.

A figure above CNY6 trillion reflects the government’s determination to support the economy and shows that the credit market has greatly improved since last year, Soochow Securities said, adding that the bill market also showed that financing to the real economy is picking up. Infrastructure investment is expected to grow more than 10 percent this quarter, and credit will continue to stabilize and rebound, it added.

The first quarter will be the high point of credit supply this year, Citic Securities said, noting that January’s data may have beaten expectations as a result of centralized loan issuance. The sustainability of credit remains to be seen this month, it added.

China’s monetary policy will be “warm and neutral” this year, according to Shenwan Hongyuan Securities. The central bank will not cut the loan prime rate, its benchmark lending rate, or interest rates again, but is likely to further trim the reserve requirement ratio for banks, it said.

Editor: Futura Costaglione