China Construction Bank contributes to BRL 15.3 billion syndicated loan for Conta-Covid Project (Linked to Project ID#90964)

On June 23, 2020, Câmara de Comercialização de Energia Elétrica (CCEE) — a private, non-profit clearinghouse for Brazil's electricity sector — signed a BRL 15.3 billion ($2.8 billion) syndicated loan agreement with 18 Chinese and non-Chinese banks and financial institutions for the Conta-Covid Project. Participants in the loan syndicate included Bradesco BBI, Itaú BBA, the Brazilian Development Bank (BNDES), Santander, Banco do Brasil, Credit Suisse, Citibank, Safra, SMBC, Votorantim, Alfa, JP Morgan, Banco Bocom BBM, China Construction Bank (Brasil), BTG and ABC Brasil. They made the following contributions: Bradesco BBI (BRL 2.9 billion), Itaú BBA (BRL 2.9 billion), BNDES (BRL 2.7 billion), Santander (BRL 2.2 billion), Banco do Brasil (BRL 1.8 billion), Credit Suisse (BRL 254,545,454), Citibank (BRL 254,545,454), Safra (BRL 254,545,454), SMBC (BRL 254,545,454), Votorantim (BRL 254,545,454), Alfa (BRL 254,545,454), JP Morgan (BRL 254,545,454), Banco Bocom BBM (BRL 254,545,454), China Construction Bank (Brasil) (BRL 254,545,454), BTG (BRL 254,545,454), and ABC Brasil (BRL 254,545,454). The Bank of Communications' contribution is captured via Project ID#90964 and China Construction Bank Corporation's contribution is captured via Project ID#95321. The loan carried the following borrowing terms: a 4.5-year maturity, a 1-year grace period, an annual interest rate of CDI plus a 2.8% margin, a 0.9% commitment fee, and a 2.5% arrangement fee. The loan was scheduled to rapidly disburse between July 2020 and December 2020. It was scheduled for repayment between July 2021 and December 2025. The loan was secured by (i.e. collateralized against) a fiduciary assignment of credit rights deposited in an account owned by CCEE (known as 'Conta Covid’). The proceeds of the loan were to be distributed by the borrower to 61 electricity distribution companies. The purpose of the loan was to provide emergency financial (‘bailout’) support to Brazilian power distributors affected by the COVID-19 pandemic. The costs of borrowing were expected to be passed on to consumers through electric bills. The loan fully disbursed. However, no additional implementation details were available as of March 2023.

Additional details

1. CDI is the interbank rate that is used as a reference to investment returns in Brazil. 2. AidData has estimated the all-in interest rate by adding 2.8% plus average CDI in June 2020 (2.62%).

Number of official sources

3

Number of total sources

19