In a Sept. 16 signed article in Qiu Shi, PBOC Governor Pan Gongsheng said slower
but higher-quality loan growth may become a new macro normal. Outstanding loans
exceed 280 tln yuan, with a still-large share tied to real estate and local
government financing platforms; those exposures are shrinking rather than
expanding. From 2025 through 1H 2026, real estate loan balances fell by more
than 2 tln yuan cumulatively. Other sectors’ lending must first offset that
decline before aggregate credit can rise. As the economy and credit mix
transition, the real economy’s demand for credit is changing; maintaining past
overall credit growth rates is difficult and unnecessary. Revitalizing
inefficient stock loans and new lending serve essentially the same role in
supporting growth.
