BNP to finance power station
By SEAN KENNEDY
FRENCH banking giant Banque Nationale de Paris (BNP) has won a mandate to arrange most of the 10 billion French franc (about HK$14.6 billion) financing for phase two of the building of the Daya Bay power station, says the bank's chief executive, Didier Balme.
Mr Balme said Chinese Government officials had signed letters of award worth six billion French francs with Framatome, the French nuclear plant company, and worth GBP350 million (about HK$4.26 billion) with GEC Alsthom.
France would supply most of the equipment for the nuclear and intermediary units, he said, and the transaction would be underpinned by French and British export guarantees, effectively insulating lending banks from China risk.
By signing on January 15, both sides were able to lock in an Organisation of Economic Co-operation and Development (OECD) consensus rate of 5.95 per cent.
It would pay another one percentage point over this because the project was nuclear.
Edward Lau, BNP's general manager of merchant banking, said that signing one day later would have locked the borrower into a revised consensus rate of 7.35 per cent.
The transaction would be backed by export credits from France's Compagnie Francaise Assurance de Credits Exports (COFACE), and Britain's Export Credit Guarantee Department (ECGD), Mr Balme said.