(Yicai) Jan. 23 -- The total balance of Chinese yuan and foreign currency loans in Shanghai jumped 9.8 percent as of the end of last year, faster than the national average of 7.2 percent, according to the local branch of the Chinese central bank.

Shanghai’s total loan balance soared 9.8 percent to CNY12.27 trillion (USD1.68 trillion) as of Dec. 31 from a year earlier, compared with 7.3 percent at the end of 2023, Li Liangsong, deputy director of the Monetary Credit Research Department of the People’s Bank of China Shanghai Head Office, said at a press conference yesterday.

Foreign currency loans surged last year because of strong demand from Chinese companies going global. In fact, Shanghai’s foreign currency loan balance skyrocketed 31 percent as of the end of December, up from 12.6 a year earlier.

Shanghai’s foreign-related economy remained active last year, said Wu Jinyou, deputy director of the Foreign Exchange Management Department of the PBOC Shanghai Head Office. Foreign-related income and expenditures soared 35 percent and 31 percent to over USD2.367 trillion and USD2.585 trillion, respectively, from the previous year.

The foreign-related payment deficit fell 1.9 percent to USD217.9 billion, remaining relatively stable, Wu noted.

In recent years, the Shanghai branch of the State Administration of Foreign Exchange has been focusing on improving the convenience of cross-border investment and financing. Qualified small- and medium-sized tech companies in the city can independently borrow foreign debts based on their operating needs, with a quota of up to USD10 million.

As of the end of last year, over 20 such enterprises applied for the above pilot program in Shanghai, with a contracted amount exceeding USD100 million and a drawdown of nearly USD50 million, Wu told Yicai.

Shanghai’s real estate loan balance rose 5.2 percent to CNY2.83 trillion (USD388.7 billion) as of the end of last year, up from a 0.9 percent growth a year earlier thanks to the recovery of the real estate industry from October after China introduced an economic stimulus package the month before.

The cost of funds, however, continued to decrease despite the rise in loan scale. The weighted average interest rate on new corporate loans issued in Shanghai fell to 3.02 percent in December from 2.7 percent a year earlier and 2.95 in November.

Among them, the weighted average interest rate on loans to small and micro-enterprises was 3.25 percent, down from 2.88 percent and 3.18 percent, respectively.

Editor: Futura Costaglione