(Bloomberg) -- The Hong Kong Housing Society, a major public housing provider of the city, has signed a HK$12 billion ($1.5 billion) syndicated loan with 12 local and international banks, the non-governmental organization said in a statement Thursday.
The largest deal of its kind for the organization, the five-year term and revolving loan facilities include a HK$3 billion social tranche, HKHS said. The loan’s overall pricing is 86 basis points over the Hong Kong Interbank Offered Rate, a local lending benchmark.
The signing of the borrowing facilities, which HKHS said will be particularly used for subsidized housing projects, underscores the rising funding needs of developers amid a worsening property slump in the Asian financial hub. Hong Kong’s public sector is facing growing financial strain, as the housing downturn has choked off one of the city’s most important sources of revenue.
Lenders of the loan include Bank of China (Hong Kong) Ltd., Industrial and Commercial Bank of China (Asia) Ltd., The Hongkong and Shanghai Banking Corp., Oversea-Chinese Banking Corp., DBS Bank Ltd., Bank of Communications Co. Hong Kong Branch, Standard Chartered Bank (Hong Kong) Ltd., and Sumitomo Mitsui Banking Corp., among others, according to the statement.
HKHS said it is now planning or building more than 20 projects, with over 17,000 subsidized housing units expected to be completed within the next five years.
Bloomberg News reported in May that HKHS had been in talks with lenders for the syndicated loan.
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