HNB raises US$ 50 m overseas loan

Hatton National Bank PLC (HNB) yesterday signed an agreement to raise US$ 50 million through a 5 year long term loan from the China Development Bank Corporation (CDB).

This is part of the bank's capital raising plan which commenced in mid-2011 to raise over Rs. 20 billion in equity and debt capital. Under the programme the bank has thus raised over Rs. 18.5 billion through a combination of tier I capital, tier II capital and senior debt to finance the development in post war Sri Lanka. China Development Bank is one of the state owned banks of the People's Republic of China with a total asset base of approximately US$ 1 trillion. It has successfully managed the balance between growth and risk as indicated by the NPA level which has been below 1% over the past 8 years.

China Development Bank is the strongest rated bank in China that has been awarded an international credit rating equivalent to the sovereign rating of China by Fitch Ratings and an international rating which is one notch below the sovereign rating by Standard and Poor.

CDB has entered into financial collaboration agreements with over 50 countries around the globe including BRICS countries, ASEAN countries and European nations.

This is the first ever transaction by China Development Bank with a private bank in Sri Lanka and it marks the beginning of a continuous co-operation between the two parties for mutual benefit.

The agreement was signed by Dr Ranee Jayamaha, Chairperson and Rajendra Theagarajah Managing Director / CEO on behalf of Hatton National Bank PLC and Wei Peng Deputy General Manager Guangxi branch on behalf of China Development Bank Corporation.

Speaking at the occasion, Dr Ranee Jayamaha, Chairperson of Hatton National Bank PLC stated that “the funds raised from China Development Bank, will boost the loanable funds available to HNB and the bank hopes to benefit from the co-operation and new relationship with the China Development Bank in the future”.

Rajendra Theagarajah Managing Director/ CEO of Hatton National Bank PLC commented that “the ability of the bank to raise funds during a short period of time, from a well reputed foreign source, at a very attractive rate of interest is a testament to the strong and sustainable growth recorded by the bank over the past”.

Qui Xiaoyu from China Development Bank said, “This US $ 50 million loan symbolizes the strong relationship between our two banks. CDB is willing to provide financing and other supports to Sri Lanka and also willing to explore more opportunities for cooperation with HNB”.