Standard Chartered Bank and Vietnam National Coal, Mineral Industries Group (Vinacomin) on September 16 signed a US$58 million syndicated term loan facility.

Of the amount, US$20 million is provided by Standard Chartered Bank, another US$20 million by Cathay United Bank, US$10 million by Malayan Banking Berhad and US$8 million by the Bank of China.

The proceeds from the facility will be used to finance Vinacomin’s capital expenditure requirements.

The loan tenor is seven years which is widely recognised as an impressive achievement under current syndicated loan market conditions when most deals are being done with a tenor of less than five years.

Addressing the ceremony, Ashok Sud, Chief Executive Officer of Standard Chartered Bank in Vietnam, Laos and Cambodia, said that the 7-year loan showed that Vinacomin had gained prestige in the international financial market.

He expressed his hope that the syndicated term loan will pave a way for other future syndicated loans for Vietnamese businesses.

On this occasion, the two corporations have also signed a Memorandum of Understanding, under which, the bank will help raise funding from the capital market to finance Vinacomin’s forthcoming investment in coal production, bauxite mining and power plants.

The bank will also offer Vinacomin financial solutions covering risk and liquidity management, training and other areas of interests.

Vinacomin, which is established in December 2005, is the biggest state-owned coal production enterprise in Vietnam.

Standard Chartered Bank, operating in more than 70 countries, opened its first branch in Saigon (now Ho Chi Minh City) in 1904.

The bank has recently been licensed to establish a 100% foreign-owned bank in Vietnam. (VNA)