Branches of the China Banking Regulatory Commission (CBRC) are cracking down on investors using bank loans to play the stock market instead of paying back their bills, the South China Morning Post reported. Sources told the newspaper that CBRC branches in Shanghai, Beijing and Sichuan have been warning lenders that loans intended for short-term bill financing should be used for short-term working capital needs, rather than for speculation in capital markets. Analysts have blamed wayward lending for surging stock markets; Wei Jianing, a scholar affiliated with the State Council, said US$169.88 billion of the US$849 billion in loans extended by domestic banks in the first five months of the year found its way into the stock market.
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