Your current location: Home - News - Industry InformationIndustry Information
China Rongsheng Heavy Industries Secures First-ever overseas Loan of US$220 Million from Crédit Agricole
Published: 2011/8/19 15:33:32 Source: Visits: 4079

(10 August 2011, Hong Kong) – China Rongsheng Heavy Industries Group Holdings Limited (“China Rongsheng Heavy Industries” or the “Group”; stock code: 01101.HK), a large heavy industries group in China, today held a signing ceremony marking the provision of a US$220 million syndicated loan with the Export-Import Bank of China and Crédit Agricole Corporate and Investment Bank (“Crédit Agricole CIB”). As part of the strategic alliance, China Rongsheng Heavy Industries has secured its first-ever syndicated loan from overseas, with a facility credit of US$220 million from the syndicate led by Crédit Agricole CIB. As Chinese banks have gradually tightened credit against the backdrop of a series of austerity measures recently launched by the Government to rationalise credit activities, the acquisition of a large syndicated loan from a foreign bank is particularly significant for the Group.

Mr. Chen Qiang, Chief Executive Officer and Executive Director of China Rongsheng Heavy Industries, said, “The acquisition of a US dollar denominated loan from Crédit Agricole CIB is a giant step for us to extend our financing channels overseas and strengthen our risk management. While it is our first overseas debt, it also spreads our brand overseas and paves the way for future cooperation with other international banks. Facing tighter credit in China, the US$220 million loan changes the proportion of debts from foreign and local banks, and provides us an opportunity to implement foreign exchange risk measures and lower our financing costs”.

With Crédit Agricole CIB as the lead arranger and the Export-Import Bank of China as the guarantor, the parties, which including over ten famous banks overseas, will commence in-depth cooperation in four major business segments of China Rongsheng Heavy Industries. The loan will be used to complement the Group’s working capital. The signing ceremony was officiated by Mr. Xavier Roux, President of Crédit Agricole CIB (China) Limited, Mr. Zhang Qiang, President of Jiangsu Branch of Export-Import Bank of China and Mr. Chen Qiang, Chief Executive Officer of China Rongsheng Heavy Industries. With the tightening credit policy in China and potential continued RMB exchange rate appreciation, foreign banks have become a new vehicle for Chinese enterprises to offset exposure to foreign exchange risks and expand funding channels. It has been highly unusual for a foreign bank to approve a loan of US$220 million to a private enterprise in China, amidst the potential continued appreciation of the RMB after the US debt crisis. Securing such a large loan in US dollars is of significance for the Group as a means to reduce the risk presented by fluctuating foreign exchange rates.

Mr. Chen Qiang concluded, “A significant volume of the Group’s orders are from overseas customers. Hence, the Group has explored measures to address foreign exchange risks and taken proactive initiative to expand its RMB settlement business. In 2010, 20% of revenue of all segments was in RMB, the proportion of RMB revenue is expected to increase further in 2011. Following the official commencement of operation at our new plant of Rongsheng Machinery Limited in Hefei in June this year, engineering machinery will become another business growth driver while playing an important role in the Group’s strategy of diversifying and strengthening its RMB business”.

Domestically in China, China Rongsheng Heavy Industries has gained several large amount credit lines by local banks since 2010, which included two record-setting credit lines of RMB50 billion from Export-Import Bank of China and Bank of China respectively. The Group subsequently entered into cooperative agreement with Agricultural Bank of China and China Everbright Bank, and has also secured lines of credit of up to RMB11 billion with China CITIC Bank at the end of June this year.

close   back
©2009- Hefei RONG AN Machinery Co., Ltd. . All Rights Reserved. 皖ICP备10002542号-1        Sitemap  Legal Notices  Contact
you are the 543160th visitor