Narrative
Full Description
Project narrative
On January 27, 2020, the Bank of China (BoC) joined a syndicate of lenders in establishing a $1.5 billion revolving credit facility for Ovintiv Canada ULC, a subsidiary of Ovintiv Inc. The facility had an initial maturity date of four and a half years, expiring on July 15, 2024, although it might have been extended once per calendar year for a maximum of five years, beginning 90 days after the date of the extension request. The facility was unsecured. Funds could be withdrawn in USD or CAD, with USD withdrawals having an interest rate determined by the greater between Prime Loans rate and USBR, and CAD withdrawals having an interest rate determined by the greater between Bankers' Acceptances, LIBOR, and Letters of Credit. Additional margin on the interest rate as well as the standby fees were determined by Ovintiv Canada ULC's debt rating, which in 2020 was downgraded from BBB to BB+, adding an extra 1.25% margin on USD loans and an extra 2.25% margin on CAD loans. At this debt rating, the standby fee would have been.45% by the end of 2020. Since 2020, Ovintiv Canada ULC has not reported any outstanding funds related to this facility. The credit facility was guaranteed by Ovintiv Canada ULC's parent company, Ovintiv Inc. The lending syndicate included the Royal Bank of Canada, JPMorgan Chase Bank, Canadian Imperial Bank of Commerce, Toronto-Dominion Bank, Citibank's Canadian branch, ATB Financial, Bank of Montreal, Bank of Nova Scotia, National Bank of Canada, Federation De Caisses Desjardins Du Quebec (FCDQ), Sumitomo Mitsui Banking Corporation's (SMBC) Canadian branch, Credit Suisse AG, Wells Fargo, Bank of America's Canadian branch, Barclays, Morgan Stanley, and Mizuho.
Staff comments
1. It is unknown whether the withdrawn amounts were denominated in USD or CAD, or if their base interest rates were determined by Bankers' Acceptances, LIBOR, Letters of Credit, Prime Loans, or USBR, making it impossible to determine the exact interest rate. 2. The credit facility was established on the same date as a USD 2.5 billion facility made to Ovintiv Inc., Ovintiv Canada ULC's owner. 3. The individual contributions of the 19 lenders of this syndicated loan, of which USD 193 million is known to have been withdrawn, are unknown. For the time being, AidData has estimated the contribution of BOC the loan by assuming that each lender contributed an equal amount (USD 10,157,894) to the syndicated loan.