七月社会融资规模：债券融资抵消信贷需求疲软

ResearchAnalyst+852-220-36141 July Total Social Financing (TSF) increased by RMB1.4tn, stronger than RMB1.1tn inJuly2025,thoughdeceleratingsequentiallyfromRMB3.4tn inJune.Thiscamein stronger than market expectations of ~RMB1.1tn,mainlyattributed toacceleratedgovernmentandcorporatebondissuance.NewRMBloanscontractedbyRMB340bninJuly,furtherweakeningfromtheRMB50bndeclineinJulylastyearand deceleratingfroma RMB1.6tn increase in June. OutstandingTSFgrowthwas stable at7.4%YoY,whileRMB loan growth slowedfurthertoanewlowof5.1%from5.2%inJune.The structurecontinuedto suggestsustained weak credit demand and a transition toward direct financing.Thisongoingtrendofweakloandemandislikelytoputpressureonbanks'balancesheetexpansion,assetyields,and NiM in2H26.However, this is likelyto be offsetbyafavorabletrend inliabilitycosts,driven bythe ongoingmigration of depositstonon-bankinstitutions.Mega-technologycompanyIPOsarealsolikelytosupportbanks'AlC and subsidiaries'investment income. WepreferbankswithrobustcorporatebankingbusinessesandcontinuetopreferCCB-Hand BOC-H. TSF:directfinancing continued to offsetweaker loansGovernment bond issuance increased to RMB1.3tn in July from RMB768bn inJune andRMB1.2tn inJuly lastyear.Government bondswere the singlelargest contributor to TSF recovery, suggesting that fiscalsupporthasstartedtoaccelerateinordertostabilizeeconomicgrowth Corporate bond issuance increased to RMB454bn in July,up fromRMB275bn lastyearand RMB401bn in June.Corporations are utilizinglow-interest-rate bond financing,whichhas partially causedtheweaknessin corporate loan demand.EquityfinancingmaintainedrobustmomentumatRMB113bn,thankstothe rise of Al technology company listings.OtherfinancingslowedtoRMB177bninJulysequentiallyfromRMB456bnin June, with write-offs staying at a relatively higher run rate, offset by acontraction inABSissuance. BanksChina Banks NewRMBloansinJulyturnedtoa contractionofRMB34Obn,thelargestonrecord, reflecting a sustained weakening of credit demand across the board and draggingoutstandingloangrowthtoanewrecordlowof5.1%.Inlightoftheseshiftingcreditdynamics,thePBOChighlightedinits2Q26monetarypolicyreportareducedfocuson loans alone,pivoting instead toward a more comprehensive financingframework that encompasses loans,direct bond issuance,and equity financing. downsignificantlyfroma RMB1.5tnincreaseinJune.Thiscontractionwasdriven by medium-to-long-term loans (down RMB230bn) and short-termfinancing (down RMB250bn),which were only partially offset by aRMB376bn increase in bill financing-reflecting subdued corporateinvestment demand and a shift toward bond channels.However,whenapplyingthePBOC'sbroaderscopeofcorporatefinancing(includingloans,bonds,and equity),wecalculatethatbroader corporatefinancingactuallyincreased byRMB436bninJuly,upfromRMB385bn inJulylastyear. Householdloansfellbackintocontraction,decliningbyRMB46ObninJulyfollowing a brief June recovery where they increasedbyRMB265bn.Thispersistent weakness in household credit demand suggests sustainedhouseholddeleveraging.It also signalsthat credit risks within theretail loansegment have yet to bottom out. DepositmigrationtoWMPscontinuesNewdeposits increased by RMB3Obn in July,decelerating significantly from RMB2tn inJuneandRMB500bn inJuly2025.Thisdecelerationwasmainlydrivencontracting by RMB1.6tn. Meanwhile, non-bank financial institutions' depositsmaintained strong momentum with a RMB1.1tn addition, suggesting that themigrationofdepositstowealthmanagementproducts (WMPs)is sustaining.Thistrend should continue to ease funding costs and support fee income forbanks.Additionally,fiscalsavingsincreasedbyRMB979bn,primarilyduetoseasonaltaxcollection. M2growth slowed to7.7%YoYfrom 8.0%in June,whileM1growthremained flatat 4.0%.The narrowing gapbetween M2and M1was due to the decline in savingsfrom both corporates and households,while system liquidity circulation remainsresilient. BanksChina Banks BanksChina Banks Source : PBOC, CEIC, Deutsche Bank Source : PBOC, CEIC, Deutsche Bank BanksChina Banks Appendix 1 *Other information available upon request ImportantDisclosuresRequiredbyU.S.RegulatorsDisclosures markedwithanasteriskmayalsoberequiredbyat leastone jurisdiction inadditiontotheUnitedStates.See ImportantDisclosuresRequiredbyNon-USRegulatorsandExplanatoryNotes.1.Within the past year, Deutsche Bank and/or its affiliate(s) has managed or co-managed a public offering for this company,forwhichit receivedfees7.DeutscheBankand/orits affiliate(s)has receivedcompensationfromthis companyfortheprovisionofinvestmentbanking orfinancial advisory services within the pastyear.8.Deutsche Bank and/or its affiliate(s)expects to receive,or intends to seek, compensationfor investment bankingservicesfromthiscompanyinthenextthreemonths.14.Deutsche Bank and/or its affiliate(s)has received compensation fromthis company within the past yearfor non-investmentbankingrelatedservices15.This company has been a client of Deutsche Bank Securities Inc.within thepast y