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Overview

China Development Bank provides $200 million loan in 2019 to People’s Bank for on-lending activities

Commitments (Constant USD, 2023)$207,597,498
Commitment Year•2019Country of Activity•Sri LankaDirect Recipient Country of Incorporation•Sri LankaSector•Banking And Financial ServicesFlow Type•Loan

Status

Project lifecycle

Pipeline: Commitment

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Mar 27, 2019
Last repayment (originally scheduled)
Mar 25, 2027

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 Policy Banks

  • China Development Bank (CDB)

Receiving agencies

State-owned Banks

  • People's Bank (Sri Lanka)

Loan description

China Development Bank provides $200 million loan in 2019 to People’s Bank for on-lending activities

Interest type•UnknownMaturity•8 years

Narrative

Full Description

Project narrative

On March 27, 2019, China Development Bank and People’s Bank of Sri Lanka signed a $200 million loan facility agreement to support on-lending activities. The loan carries an 8-year maturity and an interest rate. The loan facility agreement was signed by Chief Executive Officer/General Manager of People’s Bank, N. Vasantha Kumar, and CDB Guangxi Branch General Manager, Mei Shiwen, The signing ceremony was held at China Development Bank’s Guangxi Branch in Nanning, People’s Republic of China. However, in October 2021, the Chinese Embassy in Sri Lanka blacklisted the People’s Bank of Sri Lanka for failing to honor its contractual obligations. At the time, Chinese fertilizer enterprise Qingdao Seawin Biotech Group Co., Ltd requested payment of L/C from the People’s Bank of Sri Lanka according to the terms specified in a set of contracts. However, disregarding its contractual obligations, business rules, and international trade customs, the People’s Bank of Sri Lanka defaulted on the payment of L/C, creating large financial losses for Qingdao Seawin Biotech Group Co., Ltd, according to the Chinese Embassy in Sri Lanka.

Staff comments

1. People's Bank is a state-owned commercial bank in Sri Lanka