SBI-EXIM Bank of China Signs $1.8 bln Line of Credit Agreement

State Bank of India and The Export Import Bank of China signed a Framework Agreement for a Line of Credit of USD 1.8 billion to be offered by The Exim Bank of China. The Line of Credit will be utilized for projects involving imports of Chinese raw materials, energy, equipment, mechanical and electronic products, complete sets of equipment, high and new tech products, energy projects, infrastructure and construction projects and any other projects mutually agreed by the two banks.

Dr P.K Agrawal, General Manager (International Banking Group) of State Bank of India and Mr Mei Jianping, Dy. General Manager, Corporate Banking Department of The Exim Bank of China signed the Agreement today in New Delhi. Mr V.G. Kannan, M.D. & G.E. (A & S) and Mr Rajneesh Kumar, MD & CEO, SBI Capital Markets Ltd graced this occasion with their presence.

This Agreement signifies the deepening trade and economic relationship between the two countries. The agreement between State Bank of India, the largest commercial bank of India and The Exim Bank of China, the largest development bank of China, which focuses on the promotion of foreign trade, is one of the largest between the two countries and marks a milestone in their relationship. The line of credit will underpin the burgeoning trade between India and China by supporting Indian importers of Chinese goods and services. The agreement is expected to be an important building block in the push to the infrastructure sector initiated by the new government which is expected to require an investment of over a trillion dollars over the next few years.

State Bank of India as the largest infrastructure financier in India is at the forefront of the coming surge of financing to the infrastructure sector. China, the largest global supplier of infrastructure products and services, will have a key role in the development of India’s infrastructure. The agreement between State Bank of India and The Exim Bank of China is ideally placed and timed to give a boost to Indian infrastructure projects. New projects, which are now in the initial stage of planning now, would have access to this corpus of foreign currency funding in addition to State Bank’s unmatched corpus of Indian funds and project finance expertise. The deepening relationship between the two banks also augers well for further co-operation between the two countries and the two banks in the infrastructure space.

About State Bank of India:

State Bank of India (SBI), with a 208 year history, is the largest commercial bank in India in terms of assets, deposits, profits, branches, consumers and employees. The Government of India is the single largest shareholder of this Fortune 500 entity with 58.60% ownership.

The origins of State Bank of India date back to 1806 when the Bank of Calcutta (later called the Bank of Bengal) was established. In 1921, the Bank of Bengal and two other banks (Bank of Madras and Bank of Bombay) were amalgamated to form the Imperial Bank of India. In 1955, the Reserve Bank of India acquired the controlling interests of the Imperial Bank of India and SBI was created by an Act of Parliament to succeed the Imperial Bank of India.

The State Bank Group consists of SBI and five associate banks. The group has an extensive network; with over 20,000 plus branches in India and another 190 foreign offices spread over 36 countries across the world. As of 31st March 2014, the group had assets worth Rs. 23,95,981 crores, deposits of Rs. 18,38,852 Crores and capital & reserves in excess of Rs. 1,47,371 crores. The group commands over 23% share of the domestic Indian banking market.