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Overview

ICBC contributes $40 million USD to the $200 million USD senior tranche of a $317 million USD syndicated loan to Korean Air to finance the purchase of two Boeing 777-200ER aircraft

Commitments (Constant USD, 2023)$66,462,581
Commitment Year•2007Country of Activity•KoreaDirect Recipient Country of Incorporation•Cayman IslandsSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Dec 6, 2007
Start (actual)
Nov 30, 2007
End (actual)
Dec 20, 2007
Last repayment (originally scheduled)
Dec 3, 2017

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

Private Sector

  • BNP Paribas S.A.
  • DBS Bank Ltd.
  • ING Bank N.V.
  • Korea Exchange Bank (KEB)
  • National Agricultural Cooperative Federation (NH) (NACF)

State-owned Banks

  • Hamburg Commercial Bank (HSOB) (Formerly HSH Nordbank AG)
  • Industrial Bank of Korea (IBK)
  • KfW Development Bank (KfW Entwicklungsbank GmbH)
  • Korea Development Bank (KDB)

Receiving agencies

Joint Venture/Special Purpose Vehicles

  • KE Octavius Limited

Implementing agencies

Private Sector

  • The Boeing Company (TBC)

Loan description

ICBC contributes to the USD $200 million senior tranche of a USD $317 million syndicated loan to Korean Air to finance the purchase of two Boeing 777-200ER aircraft in South Korea in 2007

Interest rate (t₀)•5.52625%Interest type•Variable Interest RateMaturity•10 years

Narrative

Full Description

Project narrative

Between November 30 and December 6, 2007, a syndicate of 10 banks — including the Industrial and Commercial Bank of China (ICBC) — entered into a $317 million USD syndicated loan agreement with KE Octavius Limited — a Cayman Islands-incorporated special purpose vehicle (SPV) and wholly-owned subsidiary of Korean Air Lines Co., Ltd. (KAL), the flag carrier airline of South Korea headquartered in Seoul and listed on the Korea Exchange — to finance the purchase of two Boeing 777-200ER aircraft. This loan was divided into two tranches: a $200 million USD senior term loan tranche with a maturity period of 10 years with a repayment profile of quarterly equal installments and an interest rate of LIBOR plus a margin of 62.5 bps and a $117 million USD junior revolver tranche with a maturity period of six years with a repayment profile of quarterly equal installments and an interest rate of LIBOR plus a margin of 70 bps. The proceeds were used by the borrower to support the purchase of two Boeing 777-200ER aircraft. The first aircraft, HL7752, was delivered on November 30, 2007. The second aircraft, HL7764, was delivered on December 20, 2007. Financial close was achieved thereafter. ICBC contributed $40 million USD to the $200 million USD senior tranche. In addition to ICBC, the following lenders contributed the respective amounts to the tranche: BNP Paribas S.A. ($30 million USD), DBS Bank Ltd. ($30 million USD), HSH Nordbank AG ($40 million USD), ING Bank N.V. ($25 million USD), and KfW ($35 million USD). ICBC did not contribute to the $117 million USD junior tranche, which the following lenders contributed the respective amounts to: Industrial Bank of Korea (IBK) ($29.25 million USD), Korea Development Bank (KDB) ($29.25 million USD), Korea Exchange Bank (KEB) ($29.25 million USD), and National Agricultural Cooperative Federation (NACF) ($29.25 million USD). Korean Airlines mandated nine banks to provide the loan in early November 2007: BNP Paribas, DBS Bank, HSH Nordbank, ICBC, ICBC, ING Bank, KfW, KDB, and KEB. BNP served the coordinator. BNP Paribas, DBS, ICBC, HSH Nordbank, IBK, ING Bank, KfW, KDB, KEB, and NACF served as lead arrangers.

Staff comments

1. The exact signing date is unknown, it as it was listed in "Loan week, November 30-December 6", AidData assumes that the loan was signed between November 30 and December 6, 2007, coding the latter date as the commitment date and marking the commitment_date_estimated? field as True.