China's economic rebound eased banks' asset quality pressure

It also increased their appetite for lending.

According to Standard & Poor's, the acceleration in 2012 fourth-quarter economic growth to 7.9% further lowered the risk of a hard landing in China. Economic indicators for early 2013 suggest that the momentum remains unchanged and we project growth to reach 8% for the year.

Here's more from S&P:

The economic rebound likely eased asset quality pressure at banks further and increased their appetite for lending. The central government's more relaxed attitude in 2012 to debt rollovers by local government financing platforms reduced credit risk from these companies.

With better economic prospects, the major Chinese banks have reportedly been growing their new lending to the extent allowed by their monthly lending quota in January.

The Chinese government continued to make small steps in liberalizing its monetary regime. The People's Bank of China extended its bilateral currency swap arrangement to the Bank of England, its first G-7 partner.

It also allowed renminbi settlement in Singapore, the first location outside of Greater China. The first renminbi loan in China to be made without reference to the central bank policy interest rate was also done in the Qianhai region of Shenzhen in early 2013.