Money supply registered a rapid increase. By the end of 2003, the broad money supply (M2) was 22,122.3 billion yuan (US$2,665.34 billion), up 19.6 percent over 2003, or 2.8 percentage points higher than last year's growth; narrow money supply (M1) was 8,411.9 billion yuan (US$1,013.48 billion), up 18.7 percent, or 1.9 percentage points higher. The cash in circulation (M0) amounted to 1,974.6 billion yuan (US$237.90 billion), up 14.3 percent, or 4.2 percentage points higher.

Savings deposits and loans of financial institutions increased by a large margin. RMB and foreign currency savings deposits in all financial institutions at the end of 2003 totaled 22,036.4 billion yuan (US$2,654.99 billion), up 20.2 percent as compared with the year-end figure of 2002. Loans in RMB and in foreign currencies in various forms in all financial institutions reached 16,977.1 billion yuan (US$2,045.43 billion), up 21.4 percent (see Table 11). The structure of loans continued to improve. RMB loans by rural credit cooperatives stood at 1,697.9 billion yuan (US$204.57 billion), an increase of 318.6 billion yuan (US$38.39 billion). Consumption loans in RMB totaled 1,573.6 billion yuan (US$189.59 billion), an increase of 509.1 billion yuan (US$61.34 billion), of which loans for individual housing were 1,178.0 billion yuan (US$141.93 billion), an increase of 352.8 billion yuan (US$42.51 billion).

Table 11: Savings Deposits and Loans in RMB and Foreign Currencies of All Financial Institutions, 2003

Bad loans by financial institutions declined. The total volume of bad loans of major financial institutions in the banking sector, as was indicated by 5-category classification statistics, was 2,440 billion yuan (US$293.98 billion) by the end of 2003, or 190.6 billion yuan (US$22.96 billion) less than at the beginning of the year. The proportion of bad loans was 17.8 percent, or 5.32 percentage points lower than at the beginning of the year.

Stock markets developed steadily. In 2003, funds raised through issuing stocks and share rights at stock markets were 135.8 billion yuan (US$16.36 billion), an increase of 39.6 billion yuan (US$4.77 billion) over the previous year. Of this total, 97 companies issued A shares (including newly issued and convertible loan stock) and another 24 companies issued A share rights, with capital paid-in reaching 82.0 billion yuan (US$9.88 billion), an increase of 4 billion yuan (US$481 million) over 2002. The issue of 24 B shares and H shares raised another 53.7 billion yuan (US$6.47 billion) worth of foreign capital, an increase of 35.5 billion yuan (US$4.28 billion). The number of listed companies in China's stock markets rose from 1,224 at the end of 2002 to 1,287 at the end of 2003, worth a total of 4,257.8 billion yuan (US$512.99 billion), an increase of 11 percent.

Rapid progress was registered in the insurance sector. The insurance premium of domestic and the foreign insurance companies totaled 388.0 billion yuan (US$46.75 billion) in 2003, up 27.1 percent over the previous year. Of this total, the life insurance premium was 266.9 billion yuan (US$32.16 billion), health and unforeseen accident insurance was 34.2 billion yuan (US$4.12 billion) and property insurance was 86.9 billion yuan (US$10.47 billion). Insurance companies paid an indemnity of 84.1 billion yuan (US$10.13 billion) as reparations in insurance programmes, of which life insurance indemnity was 26.4 billion yuan (US$3.18 billion), and that of health and unforeseen accident insurance was 10.1 billion yuan (US$1.22 billion). Another 47.6 billion yuan (US$5.73 billion) was paid as reparations in property insurance programmes.

(China.org.cn March 1, 2004)