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Overview

ICBC contributes $60 million to A/B loan to support YPF's climate change mitigation and adaptation strategy

Commitments (Constant USD, 2023)$56,695,148
Commitment Year•2022Country of Activity•ArgentinaDirect Recipient Country of Incorporation•ArgentinaSector•EnergyFlow Type•Loan

Status

Project lifecycle

Implementation

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jan 28, 2022
Last repayment (originally scheduled)
Jan 28, 2024

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Commercial Banks

  • Industrial and Commercial Bank of China (ICBC)

Cofinancing agencies

Intergovernmental Organizations

  • Andean Development Corporation (CAF) Development Bank of Latin America

Private Sector

  • Banco Santander, S.A. (Santander Group) (formerly Banco Santander Central Hispano, S.A.)
  • Cargill Financial Services
  • Itaú Unibanco S.A.

Receiving agencies

State-owned companies

  • YPF S.A.

Loan description

ICBC contribution of USD $60 million to USD $300 million A/B loan to support YPF's climate change mitigation and adaptation strategy

Grant element•2.2547%Interest rate (t₀)•7.28443%Interest type•Variable Interest RateLoan tenor•6-month rateMaturity•2 years

Narrative

Full Description

Project narrative

On January 27, 2022, YPF S.A. — a vertically integrated, majority state-owned Argentine energy company, engaged in oil and gas exploration and production, and the transportation, refining, and marketing of gas and petroleum products — signed a $300 million syndicated A/B loan agreement with Corporación Andina de Fomento (also known as CAF or the Development Bank of Latin America), Santander, Itau Unibanco, Industrial and Commercial Bank of China Limited, Dubai (DIFC) and Cargill Financial Services International. The loan consisted of two tranches: a $37.5 million tranche (Tranche A) financed by CAF with a 2-year maturity and an interest rate of 6-month LIBOR plus a 6.75% margin and a $262.5 million tranche (Tranche B) financed by Santander, Itau Unibanco, Industrial and Commercial Bank of China Limited, Dubai (DIFC) and Cargill Financial Services International with a 2-year maturity and an interest rate of 6-month LIBOR plus a 6.75% margin. Industrial and Commercial Bank of China Limited, Dubai (DIFC) reportedly contributed $60 million to Tranche B. The borrower was expected to use the proceeds of the loan to support its climate change adaptation and mitigation strategy. As of June 2022, the loan had fully disbursed.

Staff comments

1. AidData has estimated the all-in interest rate by adding 6.75% to average 6-month LIBOR in January 2022 (0.42582%). 2. An A/B Loan product enables commercial lenders to partner with development banks (i.e., CAF) in their lending operations. Under this structure, a development bank, in its capacity as lender of record, makes a loan to a borrower that is financed by both commercial participants and the development bank. The portion of the loan supported by commercial lenders is known as the B loan, while the portion funded by the bank is referred to as the A loan.