Bank of China tightens loan issuance

BOC attempted to curb skyrocketing loan growth in line with regulator's pressure on banks.

A person familiar with the situation said the headquarters of the state-controlled lender has circulated a notice to all of its branches to stop issuing new yuan loans and also curb foreign-currency denominated new loans.

Any new loans, if they were to be extended, would have to be approved by the bank's headquarters, the person said in a report in the Wall Street Journal.

Bank of China, in a statement, said its new loans in the first 20 days of January have been high and that it will take a closer look at its lending, though it didn't say whether it had suspended lending.

Banking shares in Shanghai and Hong Kong fell on renewed concerns over lending supply after a Chinese media report said that the China Banking Regulatory Commission has asked several commercial banks to stop issuing new loans in the remaining days of January.