Bank of China contributes to Tranche A of $1.5 billion syndicated loan to South African Reserve Bank to facilitate prepayment of another loan (Linked to Record ID#72436, #72468, #72470,#72472, #72493)

Project narrative

On July 18, 2005, the South African Reserve Bank (SARB) announced the conclusion of a $1.5 billion syndicated loan agreement with a syndicate of 33 banks and financial institutions, including Bank of China. The purpose of the ‘dual-term’ loan was to finance the prepayment of a $1 billion Dual Currency Term Loan Facility dated 16 June 2003 (see Record ID#72468 and #72470) and Tranche B of a Dual Currency Term Loan Facility dated 9 July 2002 (see Record ID#72472 and #72493). The 24 Mandated Lead Arrangers were scaled down to a pre-syndication initial commitment of $62.5 million each, while the four Co-Arrangers initially committed $30 million each and the five Lead Managers initially committed $15 million each. The transaction was launched for general syndication on June 14, 2005. At the time, the SARB decided not to take up the excess funds offered and final participation levels for all investors were therefore scaled back. The final allocations were scaled back to $56 million for Mandated Lead Arrangers, $24 million for Co-Arrangers and $12 million for Lead Managers. As a Co-Arranger, the final commitment from the Bank of China was $24 million. The distribution of commitments across the two tranches can be calculated for each type of syndicate member: the Bank of China provided $18 million for Tranche A (captured via Record ID#72435) and $6 million for Tranche B (captured via Record ID#72436). Tranche A ($1 billion) had a three-year maturity and an interest rate of 3.838% (average 3-month LIBOR in July 2005 + 22.5 basis points = 3.613% +.225% = 3.838%). Tranche B ($500 million) had a five-year maturity and an interest rate of 3.913% (average 3-month LIBOR in July 2005 + 30 basis points = 3.613% +.3% = 3.913%). The borrower was able to draw down on these two tranches in USD and/or Euro.