BANKS extended 839.3 billion yuan (US$132.4 billion) in net new yuan loans in February, the central bank said Friday, below analysts’ expectations and down sharply from a monthly record in January.

Analysts polled previously had predicted new yuan loans of 900 billion yuan.

Banks doled out a record 2.9 trillion yuan in new yuan loans in January, and came under pressure from regulators to rein in lending growth in February, financial magazine Caixin reported last month, quoting banking sources.

Chinese lenders tend to front-load loans early in the year to get higher-quality customers and a full year of interest payments, and to win market share.

China is in its second year of a regulatory push to clamp down on riskier financial activity that has been fueled by a rapid build-up in debt. Banks extended a record 13.53 trillion yuan in new loans last year.

But authorities are proceeding cautiously and keeping liquidity broadly supportive to avoid any sharp drag on the world’s second-largest economy or excessive financial market volatility.

In February, outstanding yuan loans grew 12.8 percent from a year earlier, marginally slower than an expected 12.9-percent rise and compared with a gain of 13.2 percent in January.

Broad M2 money supply grew 8.8 percent from a year earlier, marginally beating forecasts for an expansion of 8.7 percent and the 8.6-percent pace in January.

China’s total social financing (TSF), a broad measure of credit and liquidity in the economy, fell to 1.17 trillion yuan in February from 3.06 trillion yuan in January. Some analysts had expected a reading around 1 trillion yuan.

TSF includes off-balance sheet forms of financing that exist outside the conventional bank lending system, such as initial public offerings, loans from trust companies and bond sales.

It is also an indicator of activity in China’s vast shadow banking sector.

At the end of February, outstanding TSF was at 178.73 trillion yuan, up 11.2 percent from a year earlier.

Premier Li Keqiang, in his annual work report last week, said he expects reasonable growth in broad M2 money supply and TSF this year, without giving specific targets.

The National Development and Reform Commission said separately that outstanding TSF and M2 will grow at a similar pace this year as in 2017.

TSF grew 12 percent last year, in line with the target, but M2 growth slowed to 8.2 percent, below the goal of around 12 percent.(SD-Agencies)