Active Mixed AidData Chinese Aid

Bank of China (Grand Cayman Branch) contributes to $168 million syndicated loan for Paper Mill Construction Project

$20.25M USD

Funder	Bank of China (BOC)
Recipient Organization	Cheng Yang Paper Mill Company
Country	Viet Nam
Start Date	Jan 01, 2016
End Date	Feb 04, 2031
Duration	5,513 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`110401`

Grant Description

BOC and BOCOM contributions to $168 million syndicated loan for Paper Mill Construction Project On July 4, 2016, Bank of China (BOC), Bank of Communications (BoCom), Bangkok Bank, Mega International Commercial Bank Central Branch, and Cathay United Bank signed a $168 million syndicated loan with Cheng Yang Paper Mill Co., Ltd for a Paper Mill Construction Project.

BOC contributed $81 million from its branches in Ho Chi Minh City, Grand Cayman, Dong Guan and Macau (as captured via Records ID #63303, #110401, #110402, and #110403). BoCom's estimated contribution is captured via Record ID #86021. Loan repayment was scheduled to begin at the end of 2018 in ten equal installments each six months.

Nine Dragons Paper Limited issued a corporate guarantee in support of the loan.

The purpose of the project was to construct a containerboard machine — with the capacity to produce 500,000 tons of recycled containerboard per year — at a paper mill that is located within My Phuoc Industrial Park in Binh Duong District and Binh Duong province. The project commenced on or around June 1, 2016.

It is not clear whether or when this project was completed.

📋 Staff Comments

The Chinese project title is 越南正阳纸厂二期.
Nine Dragons Paper Limited is a publicly listed (private) paper manufacturing company in Mainland China, engaging in the manufacturing of containerboard products which include linerboard, duplex board as well as pulp. Its CEO and largest shareholder is Mrs. Zhang Yin. Nine Dragons Paper Limited paid $22.8 million to acquire a 60% ownership stake in Cheng Yang Paper Mill Co., Ltd from Best Shine International Development, a Cayman Islands-based subsidiary of Taiwanese firm Taiwan Pulp & Paper in 2008. Then, in June 2015, Nine Dragons Paper Limited increased its ownership stake from 60% to 65%. Many large containerboard producers from China have relocated due to Vietnam due to rising land and labor costs at home.
The individual contribution from each branch of Bank of China to the syndicated loan is unspecified. For the time being, AidData assumes that each branch provided an equal share of Bank of China's $81 million contribution ($20.25 million each).

📚 Sources & References

Bank of China provides loan to Chinese paper firm in HCM City【新华网】
Bank of China provides loan to Chinese paper firm in HCM City
中国银行与玖龙纸业在越南签署银团贷款
Công ty Trung Quốc nhận được khoản vay hợp vốn để mở rộng sang Việt Nam
正阳纸厂责任有限公司：年产能力达44万吨的纸厂投入运行 Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.