PBOC: New Loans in H1 Primarily Directed Toward Manufacturing and Infrastructure, with Accelerating Growth in Real Estate Lending

On July 22, the People’s Bank of China released the Statistical Report on Loan Direction of Financial Institutions in Q2 2025. As of the end of the second quarter, the outstanding balance of RMB loans from financial institutions stood at RMB 268.56 trillion, representing a year-on-year increase of 7.1%. In the first half of 2025, RMB loans increased by RMB 12.92 trillion. From the perspective of total volume, overall credit maintained steady growth, indicating that the financial system has sustained a high level of support for the real economy.

Loans to enterprises and public institutions remained the primary driver of credit growth. The report noted that in the first half of the year, RMB and foreign currency loans to enterprises and public institutions increased by RMB 11.5 trillion, including RMB 7.08 trillion in medium- and long-term loans, demonstrating the financial sector’s continued stable funding support to the real economy.

In terms of allocation, the structure of lending across industries continued to improve. New loans were mainly directed toward manufacturing and infrastructure. As of the end of June, the balance of medium- and long-term loans to the manufacturing sector increased by 8.7% year-on-year, with an increase of RMB 920.7 billion in the first half of the year. The balance of medium- and long-term loans to the infrastructure sector rose by 7.4% year-on-year, increasing by RMB 2.18 trillion in the same period.

Credit growth remained rapid in key areas of the national economy. By the end of June, the balance of green loans reached RMB 42.39 trillion, an increase of 14.4% from the beginning of the year, with an addition of RMB 5.35 trillion in the first half. Among these, loans for green infrastructure upgrades grew significantly, increasing by RMB 2.11 trillion. Loans to technology-oriented small and medium-sized enterprises and high-tech enterprises both expanded in scale and coverage. Year-on-year, loan balance growth rates were 22.9% and 8.2%, respectively, both significantly higher than the overall loan growth rate. Loan approval rates reached 50.0% and 57.6%, 3.2 and 1.0 percentage points higher than the same period last year.

Financial resources have increasingly flowed toward weaker segments of the national economy. As of the end of June, the balance of inclusive small and micro enterprise loans stood at RMB 35.57 trillion, up 12.3% year-on-year. The balance of student loans reached RMB 267.7 billion, up 28.4% year-on-year. The balance of agriculture-related loans reached RMB 53.19 trillion, a year-on-year increase of 7.4%. These growth rates were all higher than the overall loan growth rate. In addition, the report indicated a recovery in the growth rate of real estate loans.

By the end of Q2 2025, the balance of RMB real estate loans reached RMB 53.33 trillion, a year-on-year increase of 0.4%, 0.6 percentage points higher than the end of the previous year. In the first half of the year, real estate loans increased by RMB 416.6 billion.

As of the end of Q2 2025, the balance of real estate development loans stood at RMB 13.81 trillion, a year-on-year increase of 0.3%, with an increase of RMB 292.6 billion in the first half. The balance of personal housing loans reached RMB 37.74 trillion, a year-on-year decrease of 0.1%. However, the growth rate was 1.2 percentage points higher than at the end of the previous year, with an increase of RMB 51 billion in the first half.