ICBC participates in $565 million syndicated loan with Pakistan’s Ministry of Finance in July 2018 to shore up foreign exchange reserves

Project narrative

In July 2018, Pakistan’s Ministry of Finance signed a $565 million syndicated loan agreement with 5 banks, including Credit Suisse, the Export-Import Bank of China, the Industrial and Commercial Bank of China (ICBC), the Paris Branch of Bank of Zhengzhou, and the Beijing Changping subbranch of Postal Savings Bank of China. Credit Suisse and ICBC served as lead advisors, joint mandated lead managers, and bookrunners; the Paris Branch of Bank of Zhengzhou and the Beijing Changping subbranch of Postal Savings Bank of China served as lead arrangers. According to FinanceAsia, ‘China and its banks stumped up the cash at a time [mid-2018] when elections were just around the corner and political volatility was at its height.’ The loan carried a 1-year maturity and an interest rate of LIBOR plus a 2% margin. The borrower was expected to use the proceeds of the loan to shore up the country’s official foreign exchange reserves.