New loans extended by Chinese banks nearly halved in October from the previous month, data from the People's Bank of China showed Friday.
Banks extended news loans worth CNY 651.3 billion versus CNY 1.22 trillion in September.
Separately, the PBoC announced that total social financing, a broad measure of credit in the economy, tumbled to CNY 896.3 billion in October from CNY 1.72 trillion in the previous month.
Capital Economics economist Julian Evans-Pritchard said the latest drop in new lending was seasonal and broad credit is likely to resume its slowdown slide in coming months, as Chinese policymakers continue to prioritize tackling credit risks over boosting economic activity, which has held up well recently.
"It is possible that the PBOC may reverse course and conduct further policy loosening if faced with the prospect of an external shock such as the imposition of major tariffs by a Trump presidency," the economist said.
"But our central view is that the PBOC will refrain from further easing until clear signs of renewed economic weakness emerge, most likely during the middle of next year."
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