Hong Kong Airport Authority signs HK$35 billion loan deal that includes funds for 3RS

Authority launched deal originally pegged at HK$20 billion but raised amount due to 'overwhelming' bank demand.

Hong Kong airport
The loan package signing ceremony. (PHOTO: HKAA)

The Airport Authority of Hong Kong announced Tuesday (23 June) that it signed five-year HK$35 billion (US$4.5 billion) loan facilities with 21 local and international banks. The facilities comprise a term loan tranche of HK$17.5 billion and a revolving credit facility tranche of the same amount. The all-in pricing of 82 basis points over Hong Kong Inter-Bank Offered Rate (HIBOR) is among the lowest interest rate for club or syndicated bank loan deals with the same tenor since the outbreak of COVID-19. The facilities will be used for funding authority’s capital expenditure, including that of the Three-runway System (3RS) project and for general corporate purposes.

The authority said the funding will help it continue building a third runway (PHOTO: Shutterstock)

The authority launched the facilities at HK$20 billion, and received overwhelming demand from the banks. Considering the authority’s coming funding requirements, it decided to increase the amount of the facilities to HK$35 billion.

Jack So, chairman of the Airport Authority of Hong Kong. (PHOTO: HKAA)

Jack So, chairman of the authority, said: “We are very pleased with the financial community’s overwhelmingly positive response towards our term and revolving credit facilities amidst the coronavirus pandemic. This support demonstrates their confidence in the AA and the long-term development prospects of Hong Kong International Airport. Much more than a financial instrument, the facilities represent the global banking community’s faith in Hong Kong’s future. The pandemic crisis has not distracted us from our long-term vision of securing the airport’s position as a leading international aviation hub, for which the development of the 3RS holds the key. The project is progressing well, and we are on track to commence operation of the third runway in 2022 and the entire 3RS in 2024.”

Participating banks include:

Mandated Lead Arranger, Bookrunner and General Advisor

  • China Development Bank Hong Kong Branch

Mandated Lead Arrangers, Bookrunners and Coordinators

  • Bank of China (Hong Kong) Limited
  • Sumitomo Mitsui Banking Corporation
  • Australia and New Zealand Banking Group
  • The Hongkong and Shanghai Banking Corporation
  • Standard Chartered Bank (Hong Kong)

Mandated Lead Arrangers and Bookrunners

  • Industrial and Commercial Bank of China (Asia)
  • Bank of Communications (Hong Kong Branch)

Mandated Lead Arrangers

  • Agricultural Bank of China (Hong Kong Branch)
  • Citi

Lead Arrangers

  • Chiyu Banking Corporation
  • The Bank of Nova Scotia, Hong Kong Branch
  • Crédit Agricole Corporate and Investment Bank
  • China Everbright Bank (Hong Kong Branch)
  • CMB Wing Lung Bank
  • Dah Sing Bank
  • DBS Bank
  • Hang Seng Bank
  • Mizuho Bank
  • Oversea-Chinese Banking Corporation
  • Shanghai Commercial Bank

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