The Chinese banking industry enjoyed an excellent climate in the fourth quarter and Chinese bankers are feeling confident about the Chinese economy, said the People's Bank of China on Wednesday.

The central bank reported a rebound in the bankers' confidence index from last quarter's 43.8 points to 58.4 points. But the figure is still below the first quarter and much lower than the 79.9 points recorded at the same period last year.

Meanwhile, the banking climate index climbed for the sixth quarter in a row to reach 69 points, the highest score since 2004,indicating the country's banks are functioning well.

The central bank said the better climate was reflected in an adequate supply of funds and strong demand for banking services.

The two indices are the results of a national survey of the heads of 2850 banking institutions conducted by the central bank and the National Bureau of Statistics.

54 percent of the surveyed bankers considered the country's economy performed "normally" in the fourth quarter, while 44.7 percent deemed it "on the heated side", dropping for the first time in the year.

The survey shows 63 percent of the bankers felt the government's monetary policy was "suitable", up from 57 percent last quarter, but the percentage of those who felt the policy to be "a little too stringent" also rose significantly.

The central bank has raised the deposit reserve ratio three times this year to oblige commercial banks to lodge more funds in the central bank. The third rise was announced on November 4.

It has also raised the interest rate of loans twice this year to curb excessive currency liquidity.

China's bank loans in Renminbi rose 14.8 percent year-on-year in November, the lowest monthly increase since April, according to a report by the central bank.

Demand for loans remained high, and individual consumer credit applications rose slightly to reach a record high, according to the survey.

Foreign-funded banks also observed a rise in the demand for loans.

On Dec. 11, China opened its banking industry to foreign competitors in line with its commitment to the World Trade Organization.