CDB provides $300 million loan to Habib Bank Limited for on-lending purposes in 2019 (Linked to Record ID#70007)

Project narrative

On April 26, 2016, China Development Bank (CDB) announced that it would provide Habib Bank Limited (HBL) — a commercial bank in Pakistan — with $300 million in project financing for certain projects in Pakistan and $200 million for offshore working capital financing needs. At the time, HBL had recently received a license to open a branch in China. Then, on June 15, 2017, CDB and HBL signed a $196 million loan agreement to expand HBL’s offshore operations and to finance energy projects. The loan carried the following borrowing terms: a 3-year maturity, a 6 month grace period, and an interest rate of LIBOR plus a 2.45% margin. The borrower was responsible for making repayments in six semi-annual installments between December 2017 and June 2020. Loan disbursements amounted to $188 million in 2018. HBL reportedly began making repayments in December 2017. Then, in 2019, CDB and HBL signed a $300 million long-term loan agreement to enable HBL to on-lend to its customers. The first loan disbursement (drawdown) took place on January 31, 2019. Additional disbursements (drawdowns) were permitted until January 31, 2023. Cumulative disbursements amounted to $62.890 million in 2019, $165.975 million in 2020, and $170.975 million in 2021. The loan carried a 14-year maturity, a 4-year grace period, and an interest rate of LIBOR plus an unspecified margin. The borrower is responsible for making semi-annual repayments between January 31, 2023 and January 31, 2033.