China's banks may fall short of 2012 lending target

China’s largest banks may miss their lending targets for the first time in seven years as the economy cools and demand for loans falls, Bloomberg reported, citing three unnamed bank officials. A fall-off in new loans issued during April and May indicate lending for the full year may come in at around RMB7 trillion (US$1.1 trillion), short of the government goal of RMB8-8.5 trillion. Officials with familiar with the situation say that banks are looking to small and medium-sized enterprises to take up the slack in demand from big state-owned enterprises. New lending in April was down 33% from the month before. Some experts argue that May figures may prove worse: Liu Yuhui, a director at the Chinese Academy of Social Sciences, said that China’s “Big Four” banks had extended just RMB34 billion (US$5.4 billion) in new loans as of May 20.