CHINA'S big four banks extended an "unusually high" 170 billion yuan (US$27.5 billion) in new yuan lending in the first week of this month.

The Industrial and Commercial Bank of China, China Construction Bank, the Agricultural Bank of China and the Bank of China lent an "unusually high" amount of new yuan loans last week, the Shanghai Securities News reported yesterday.

In June the Chinese quartet may have extended combined new loans of 270 billion yuan, the newspaper said, adding that aggressive lending was seen during the first 10 days of last month.

Ni Jun, an analyst with Shenyin and Wanguo Securities, said new lending by the four biggest banks surged following the credit squeeze in the domestic interbank market at the end of last month.

The People's Bank of China refused to inject capital into the market last month, even when the country's money market rates jumped to record highs amid an acute cash squeeze. The PBOC reiterated in several statements that there's enough liquidity in the market.