WISCO secures foreign loan to purchase iron ore
July 2, 2008
July 2nd (Steel Guru) – Shanghai Securities News reported that Wuhan Iron & Steel Corp has got an approval of borrowing USD 169 million from a foreign bank group for buying iron ore.
This is the largest loan registered in China this year featured with a biggest number of lending banks and lowest lending rate in USD. According to the report, the bank group consists of 9 foreign banks, Banque de l’Indochine and Royal Band of Scotland as the lead banks, NanYang Commercial Bank, Commerzbank, KBC Bank NV, Swedbank, Westpac Banking Corp, Bangkok Bank Public Company Limited and Public Bank Limited.
Mr Xavier Roux director of branch bank in China of Banque de l’Indochine said in the current situation of weakening economy over the world as well as badly limited USD liquidity, so many foreign banks joined to invest in WISCO was a sign of their acknowledgement of the achievements the steel maker has obtained during past years and the confidence in the company’ ability to win the future.
As reported, under the circumstance of tight monetary policy and declining USD to CNY exchange rate, WISCO adjusted the capital structure for maximization in due time and enhanced ratios of USD liability and medium and long term debts among efforts to cut down capital cost, while controlling the debt scale. It adopted vehicles like choosing financial products which combine CNY with foreign currency, expanding direct investment ratio and making good use of functions of finance house in financing and hedge to guarantee FOREX value.