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Overview

ICBC contributes to $1.85 billion USD syndicated loan to Nakheel for general corporate purposes

Commitments (Constant USD, 2023)$132,169,906
Commitment Year•2007Country of Activity•United Arab EmiratesDirect Recipient Country of Incorporation•United Arab EmiratesSector•Business And Other ServicesFlow Type•Loan

Status

Project lifecycle

Pipeline: Commitment

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jan 1, 2007
Last repayment (originally scheduled)
Dec 31, 2011

Geospatial footprint

Map overview

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The project provided a loan to Nakheel, whose HQ is located in Dubai, UAE. The address of Nakheel HQ is King Salman Bin Abdul Aziz Al Saud Street, Dubai, UAE. More detailed locational information can be found at: https://www.openstreetmap.org/node/4380822518

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)

Receiving agencies

State-owned companies

  • Nakheel PJSC (Nakheel Properties)

Loan description

2007 syndicated $1.85 billion USD loan from ICBC and others to Nakheel for general corporate purposes in the United Arab Emirates

Interest type•UnknownMaturity•5 years

Narrative

Full Description

Project narrative

In 2007, the Industrial and Commercial Bank of China (ICBC) and 21 other banks participated in a $1.85 billion USD Islamic syndicated loan that was issued to Nakheel — a property developer and subsidiary of investment company Dubai World — for general corporate purposes. The loan carried a maturity of five years, with its final maturity date falling in August 2012. However, Nakheel and Dubai World had debt repayment problems, and Nakheel attempted in April 2011 to restructure $10.9 billion USD of debt, including the $1.85 billion USD syndicated loan. Nakheel offered lenders repayment after four and a half years at an interest rate of 4% plus a LIBOR margin, including on the syndicated loan, while the lenders sought repayment on the syndicated loan over seven years.

Staff comments

1. Dubai World (迪拜世界) is an investment company that manages and supervises a portfolio of businesses and projects for the Government of Dubai. 2. Dubai World, one of three flagship holding companies of the Dubai Government, invested heavily in the real estate boom which eventually burst in late 2008. Banks lent easily to Dubai World and its subsidiaries, assuming implicit government backing. After the global financial crisis, Dubai World’s refinancing needs soared as banks stopped lending. In November 2009, Dubai World said it would seek a delay on repaying $26 billion USD in debt, linked to its property units Nakheel and Limitless. The news caused global markets to tumble on fears that the Government of Dubai could no longer service its debts. 3. The individual contributions of the 22 lenders to the syndicated loan are unknown. For the time being, AidData has estimated the contributions ($79,545,454.5 USD) of ICBC by assuming that each lender contributed an equal amount to the loan syndicate.