BEIJING - China's banking institutions saw an increase in total assets in 2018, with a rapid increase in loans, the country's top banking regulator said.

By the end of last year, onshore assets of the industry totaled 261.4 trillion yuan ( $38.49 trillion), up 6.4 percent year on year, Liu Zhiqing, an official with the China Banking and Insurance Regulatory Commission, said at a recent meeting.

Loans on the balance sheets of the banks climbed 12.6 percent year-on-year to 140.6 trillion yuan, Liu said.

Credit quality was generally stable, with the non-performing loan ratio of commercial banks standing at 1.89 percent. The ratio of "special mention" loans, or those that are currently performing but could potentially turn sour, declined 1 percentage point from a peak in 2016 to 3.16 percent, he said.

Commercial banks written off a total of 988 billion yuan in bad loans, an increase of 259 billion yuan from 2017, allowing banks to lend more to private and small and micro businesses, the official said.