POLITICS & INSTITUTIONS - ECONOMY

Cargolux gets $155m credit line from Bank of China



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Europe’s largest cargo-only air carrier has tapped a line of credit from Bank of China, the world’s 4th largest bank. Photo credit: Maarten Visser via Flickr (CC BY-SA 2.0) 

Cargolux has struck its second financing deal with a major Chinese bank.

Bank of China extended a $155m global credit line to Luxembourg’s all cargo airline this week, according to announcements posted on the Aviator and Stat Times industry news sites.

The first tranche of $45m was “immediately implemented”. The statement explained that:

“The agreement foresees several realms for cooperation in order to strengthen bilateral ties which include mid-term credit facilities, bonds (Schuldschein), financial market products and aircraft financings.”

The memorandum of understanding was signed on 11 September, as part of the Luxembourg trade mission to China led by the DP finance minister Pierre Gramegna.

Cargolux “signed a facility agreement” with Industrial and Commercial Bank of China, “the world’s biggest bank by assets”, in September 2017.

In 2014, 35% of the carrier was bought by HNCA, an aviation investment group, and the airline opened a hub in Zhengzhou, in central China. The two firms plan to launch a regional joint venture carrier in 2019.

Both Bank of China and ICBC have European hubs in Luxembourg.