In July, the total social financing (TSF) aggregate fell to 273.1 billion yuan ($44.34 billion), indicating the amount of money flowing into China's economy slowed to the lowest monthly reading since the October 2008 depths of the global financial crisis.
Some are concerned about the decline in new shadow banking, particularly for the trust funds.
"The trust fund industry is the single largest funding provider behind the wave of leveraging up among the local governments and property developers over the recent years," Dong Tao, an economist at Credit Suisse, said in a note Wednesday.
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Tao cited data from the China Trust Industry Association which showed the trust industry's assets under management hit a record high of 12.48 trillion yuan in the second quarter, but asset growth was only 6.4 percent from the previous quarter, the slowest since data became available.
"The decline in capital influx for trust funds will likely have direct implications on funding for infrastructure and property projects," Tao said. "It also threatens the ability of debt repayment of these players when the debt matures."
With many maturities set for the end of this year and the first half of 2015, "that is likely to be the window time for default waves that potentially could cause chain reaction and threaten the financial stability in the economy," he said.
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Others aren't certain that the government will permit a debt-default shakeout.
"The medium-term direction of a more reform-oriented, market-oriented approach to the financial sector -- medium-term wise, the government will move in that direction," Louis Kuijs, an economist at RBS, said in a phone interview. "What I don't know and what I wonder is how forceful they will be in the short-term in pursing it."