Cash-rich Chinese banks continue taking ground in Africa, with the announcement on 11 September that South Africa’s Standard Bank (www.standardbank.co.za) has a US$1 billion loan facility from four Chinese banks, its first fund-raising in Asian capital markets.
The lenders are Industrial and Commercial Bank of China (Macau) Limited, which has a 20% stake in Standard Bank, Bank of China, China Development Bank and China CITIC Bank. The five-year loan is for “general corporate purposes”, according to the bank, and is repayable in a bullet capital single tranche on maturity
Jacko Maree, Chief Executive of the Standard Bank Group, says: “This transaction is a first for a South African borrower dealing in the Asian market. The deal reflects the trust that Chinese banks have in Standard Bank, Africa and emerging markets, despite the tough global capital markets.
“This deal will serve as a platform for future cooperation between Standard Bank and these banks across a range of different banking products and geographies to support Chinese companies going global into emerging markets.”
According to Reuters newsagency, Standard Bank expects a dozen major lending deals in Africa with its China partner next year, as resource-hungry Chinese firms begin returning to the continent. Chinese companies are said to be looking for opportunities focusing on mining, oil and gas and mineral sectors. The bank expects fast-growing and huge demand for financing for resources and infrastructure.