Bank of China had told its credit officials to put a stop to issuing new loans due to the speed of loan growth in January, the Wall Street Journal reported, citing a source close to the situation. A second source said that some small- to medium-sized stockholding commercial banks were being asked to raise the amount of reserves they hold at the central bank. However, an official from the People’s Bank of China’s news department claimed he was unaware of such a request. Speculation has been mounting over Beijing’s moves to stem the flood of liquidity entering the system. Liu Mingkang, chairman of the banking regulator, has denied claims that commercial banks have been asked to stop lending.
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