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Overview

China Construction Bank contributes $94.6 million NZD to a $284 million NZD syndicated sustainability-linked loan for the NZ Schools II Public-Private Partnership (PPP) Refinancing Project

Commitments (Constant USD, 2023)$58,079,069
Commitment Year•2023Country of Activity•New ZealandDirect Recipient Country of Incorporation•New ZealandSector•EducationFlow Type•Loan

Status

Project lifecycle

Pipeline: Commitment

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Mar 30, 2023
Last repayment (originally scheduled)
Mar 29, 2026

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

  • China Construction Bank Corporation (CCB)

Cofinancing agencies

Private Sector

  • Commonwealth Bank of Australia (CBA) (CommBank)

Receiving agencies

Joint Venture/Special Purpose Vehicles

  • NZ Schools II Public Private Partnership

Loan description

2023 syndicated $284 million NZD sustainability-linked loan from CCB for the NZ Schools II Public-Private Partnership (PPP) Refinancing Project

Interest type•Variable Interest RateMaturity•3 years

Narrative

Full Description

Project narrative

On March 30, 2023, a two-bank syndicate — China Construction Bank Corporation (CCB) and the Commonwealth Bank of Australia (CBA) — signed a $284 million NZD ($176.2 million USD) syndicated sustainability-linked loan (SLL) agreement with NZ Schools II Public Private Partnership — a special purpose vehicle (SPV) that manages four schools in Auckland, Christchurch, and Queenstown that is wholly owned by Public Infrastructure Partners II (PIP II), an infrastructure fund focused on New Zealand PPPs that is managed by H.R.L. Morrison & Co Limited, a New Zealand-based specialist global infrastructure manager — for the NZ Schools II Public-Private Partnership (PPP) Refinancing Project. This loan carried a maturity period of three years with an amortizing loan repayment profile with a balloon payment at maturity and an interest rate based on the Bank Bill Benchmark Rate (BKBM) plus a margin. This loan was named a SLL because of it featured Key Performance Indicators (KPIs) based on environmental, social and governance (ESG) factors such as green buildings, energy efficiency, waste management, water management, access to clean transportation (cycle and pedestrian ways), and access to essential services; the SLL was made in alignment with the Asia-Pacific Loan Market Association’s (APLMA) Green and Social Loan Principles 2023. However, unlike many other SLLs, this SLL did not include a margin ratchet that was dependent on the borrower's performance. The proceeds were to be used by the borrower to refinance existing debt facilities on its four-school portfolio and to support the expansion of two of the schools, including the expansion of Rolleston College to increase student capacity by 700 and the refinancing of its existing debt facilities and the expansion of Wakatipu High School. CCB contributed about $94.6 million NZD and CBA contributed about $189.3 million NZD to the loan syndicate. CBA served as sole Sustainability Coordinator. The NZ Schools II PPP was established with New Zealand's Ministry of Education in 2017 to design, finance, construct, and maintain for a 25-year period a four-school portfolio: Rolleston College and Haeata (Aranui) Community Campus in Christchurch; Wakatipu High School in Queenstown; and Ormiston Junior College in Auckland and expansion projects at Rolleston College and Wakatipu High School. The four schools had a combined enrollment of about 5,000 students.