BOC takes the lead in financing the country's 'going out' projects

Bank of China has helped Chinese enterprises expand abroad with its integrated marketing, product and management systems and by utilizing its international and diversified background.

By June, it had supported 1,847 "going out" projects with total financing of $136.5 billion, a 12 percent increase from the end of last year. Loan withdrawals during the same period reached $118.5 billion, up 17 percent, while loan balance rose to $81.1 billion, up 20 percent, compared to 2014 year end.

Of the 1,847 projects, 67 were in the form of export credit, 167 as acquisition loans and 1,613 for operating loans with the amount financed by Bank of China being $9.5 billion, $50.7 billion and $76.3 billion, respectively.

Giving full play to its competitive edge in internationalization and diversification, the bank also actively supported cross-border mergers and acquisitions by adopting the "commercial bank plus investment bank" model. By the end of June, the bank supported 167 M&A projects in multiple industries including electronics manufacturing, infrastructure construction, business services and leasing industries. Successful projects included the acquisition of Lumileds by GSR Ventures, the John Holland Group by China Communications Construction Co, the privatization of Omni Vision Technologies and the acquisition of 80 percent equity in Cronos by Bohai Leasing.

Taking advantage of its niche products in export credit and structured financing, Bank of China has issued export buyers' credit fund to nearly a hundred of "going out" export and overseas projects in 37 countries, amounting to nearly $10 billion. By the end of June 2015, Bank of China had successfully completed a number of projects that gained wide acclaim, including the first project in Africa led by a Chinese bank-Mamba thermal power station project in Zambia, the first structured financing business that combines project financing and operational leasing in the industry - the Magyar Telecom FTTH project in Hungary, and the OCTG project of Huludao Steel Pipe Industrial Co, an exemplary project of the Belt and Road Initiative.

Through its domestic and foreign branches and subsidiaries, Bank of China is utilizing low-cost overseas funds to support "going out" projects and promote cross-border trade. In addition, it effectively reduces the corporate financing costs of "going out" companies through processing domestic foreign currency loans.

In the future, Bank of China is looking to become the preferred choice for "going out" Chinese enterprises, through embracing strategic opportunities brought by the new pattern of economy and making full use of its overseas service network and other diversified advantages.

wangyanfei@chinadaily.com.cn