Bank of China contributes $50 million USD to a $2 billion USD syndicated revolving credit facility to Lehman Brothers Holdings for refinancing and general corporate purposes (Linked to Record ID#105690)

Project narrative

On March 14, 2008, a syndicate of 40 banks — including the New York Branch of the Bank of China (BOC) and the New York Branch of the Bank of Communications (BoComm) — entered into a $2.0 billion USD syndicated revolving credit facility (RCF) agreement with Lehman Brothers Holdings Inc. — a Delaware-incorporated American global financial services company and investment bank headquartered in New York City, New York — for refinancing and general corporate purposes. This RCF was an amendment and restatement of an existing RCF. This RCF carried a maturity period of three years, a final maturity date in February 2011, carried an interest rate of LIBOR plus a margin of 60 basis points (bps), and was unsecured. The proceeds were to be used by the borrower to refinance the existing three-year facility. BOC NY Branch contributed $50,000,000 USD as a managing agent and the BoComm NY Branch contributed $10,000,000 USD as a participant to the loan syndicate. Record ID#105689 captures BOC's contribution. Record ID#105690 captures BoComm's contribution. In addition to BOC and BoComm, the following lenders contributed the respective amounts in these roles to the RCF: J.P. Morgan Securities Inc. ($160,000,000 USD as administrative agent), Citibank, N.A. ($160,000,000 USD as syndication agent), the Bank of New York Mellon ($100,000,000 USD as documentation agent), Calyon ($100,000,000 USD as documentation agent), U.S. Bank National Association ($100,000,000 USD as documentation agent), Bank of America, N.A. ($75,000,000 USD as senior managing agent), the New York Branch of the Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU) ($75,000,000 USD as senior managing agent), Sumitomo Mitsui Banking Corporation (SMBC) ($75,000,000 USD as senior managing agent), Swedbank AB (publ) ($75,000,000 USD as senior managing agent), BNP Paribas S.A. ($75,000,000 USD as senior managing agent), Mizuho Corporate Bank, Ltd. ($65,000,000 USD as senior managing agent), ABN AMRO Bank N.V. ($50,000,000 USD as managing agent), Banco Santander Central Hispano, S.A. ($50,000,000 USD as managing agent), HSBC Bank USA, N.A. ($50,000,000 USD as managing agent), Lloyds TSB Bank plc ($50,000,000 USD as managing agent), National Australia Bank Limited (NAB) ($50,000,000 USD as managing agent), Nordea Bank Finland Plc ($50,000,000 USD as managing agent), Skandinaviska Enskilda Banken AB (SEB) ($50,000,000 USD as managing agent), Standard Chartered Bank ($50,000,000 USD as managing agent), Svenska Handelsbanken ($50,000,000 USD as managing agent), Australia and New Zealand Banking Group (ANZ) ($40,000,000 USD as co-agent), KBC Bank N.V. ($35,000,000 USD as co-agent), the New York Branch of WestLB AG ($25,000,000 USD as participant), Danske Bank A/S ($25,000,000 USD as participant), the New York Branch of Bayerische Hypo-und Vereinsbank AG ($25,000,000 USD as participant), the Northern Trust Company ($25,000,000 USD as participant), Sovereign Bank ($25,000,000 USD as participant), State Street Bank and Trust Company ($25,000,000 USD as participant), Toronto Dominion (Texas) LLC ($25,000,000 USD as participant), Wells Fargo Bank, N.A. ($25,000,000 USD as participant), BMO Capital Financing Inc. ($20,000,000 USD as participant), Banco Bilbao Vizcaya Argentaria S.A. ($20,000,000 USD as participant), Commerzbank AG ($20,000,000 USD as participant), DnB NOR Bank ASA ($20,000,000 USD as participant), PNC Bank, National Association ($20,000,000 USD as participant), Royal Bank of Canada (RBC) ($20,000,000 USD as participant), Westpac Banking Corporation ($20,000,000 USD as participant), and Bank Hapoalim B.M. ($20,000,000 USD as participant. JPMorgan Chase Bank served as administrative agent. Citibank, N.A. and JPMorgan served as lead banks. This RCF was oversubscribed by $0.3 billion USD. As of May 31, 2008, there were no outstanding borrowings under the RCF. There were no amounts outstanding under the facility as of September 15, 2008. On September 15, 2008, Leman Brothers Holdings filed a voluntary petition for bankruptcy with the United States Bankruptcy Court for the Southern District of New York. Concurrent with the bankruptcy filing, the RCF was automatically terminated. At the time of its collapse, Lehman was the fourth-largest investment bank in the United States with 25,000 employees globally. It had $639 billion USD in assets and $613 billion USD in liabilities. At the time of its collapse, Lehman was the fourth-largest investment bank in the United States with 25,000 employees globally. It had $639 billion USD in assets and $613 billion USD in liabilities. Lehman invested heavily into the subprime mortgage market, which began to have defaults rising in early 2007. Lehman's exposure to mortgages put pressure on its stock and in mid-2008 it was experiencing heavy losses. A plan for Korea Development Bank to acquire a stake in Lehman fell apart, as did other last-ditch takeover plans. The collapse negatively impacted global markets amidst the 2007-2008 financial crisis.