ICBC participates in $400 million syndicated loan to TDB for trade financing, project and infrastructure financing, debt refinancing, and general corporate purposes in October 2016 (linked to project #98649)

On October 5, 2016, the Southern African Trade and Development Bank (TDB) signed a $400 million syndicated loan facility agreement with a group of 18 banks. The loan had two tranches: a 2-year tranche with an interest rate of LIBOR plus a 2.5% margin and a 3-year tranche with an interest rate of LIBOR plus a 2.3% margin. Citi, Industrial and Commercial Bank of China Limited, London Branch, Mashreqbank psc, Mizuho Bank, Ltd., Standard Chartered Bank, Sumitomo Mitsui Banking Corporation Europe Limited, and The Bank of Tokyo-Mitsubishi UFJ, Ltd. served as book runners and Initial Mandated Lead Arrangers. Commerzbank Aktiengesellschaft, Filiale Luxemburg served as Initial Mandated Lead Arranger to arrange the facility. The borrower was expected to use the loan proceeds to (i) repay a short-term facility which refinanced the borrower’s 2014 $320,500,000 syndicated term loan (project #98649) and (ii) for trade financing, project, and infrastructure financing and for general corporate purposes.

Additional details

1. The Eastern and Southern African Trade and Development Bank (“PTA Bank” or the “Bank”) was established on 6th November, 1985 pursuant to the provisions of Chapter 9 of the Treaty (1981) establishing the Preferential Trade Area for the Eastern and Southern African States (PTA) which was later transformed into the Common Market for Eastern and Southern Africa (COMESA). The Bank is an African development financial institution and is the financial arm of COMESA. Although the Bank is a COMESA institution, its membership is open to non- COMESA States, non-regional countries as well as institutional shareholders. The Bank’s mission is to be at the forefront of providing development capital, through customer focused and innovative financing instruments backed by competitively priced funds. The Bank provides Project & Infrastructure Finance and Trade Finance as its core products and services. These products and services are available to businesses and enterprises incorporated and doing business in the PTA Bank Member States. The Bank has also successfully issued local currency bonds in Uganda, Kenya and Tanzania, with the proceeds of the bonds being invested in the respective countries of issuance. The Chinese government is the largest shareholder in the Bank, with a 9.3% shareholding. 2. The precise size of the contribution of ICBC to the loan syndicate is unknown. For the time being, AidData assumes equal contributions to the $400 million loan ($22,222,222) across the 18 known participants in the loan syndicate. 3. The size of each loan tranche is unknown. As such, AidData has estimated the loan’s maturity by taking the average of a 2-year maturity and 3-year maturity and estimated the all-in interest rate by adding 2.4% (the average of the 2.3% margin that applied to the 2-year tranche and the 2.5% margin that applied to the 3-year tranche) to average 6-month LIBOR in October 2016 (1.259%). However, various sources note that the actual interest rates that applied would change depending on the borrower’s credit rating.

Number of official sources

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Number of total sources

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