State-owned Qatar Energy has secured a $3 billion loan from Chinese banks, according to people familiar with the matter, another sign that financial firms are still willing to lend to certain Gulf borrowers, despite the protracted US war with Iran. Bank of China Ltd., Industrial and Commercial Bank of China Ltd., Agricultural Bank of China Ltd., and China Construction Bank (Asia) Corp. were the four lenders on the five-year facility, said the people, who asked not to be identified discussing private matters.
The deal was priced at 50 basis points over the Secured Overnight Financing Rate and proceeds will be used for general working capital. The Qatar Energy loan highlights the key role Chinese banks continue to play in the region, even as tensions remain high. Last year Chinese banks’ lending to the Gulf jumped more than five-fold to a record $11.5 billion, excluding bilateral loans, according to Bloomberg-compiled data.
While the conflict has prompted some pullback, capital flows for syndicated deals are roughly in line with lending patterns from 2024, at about $2.3 billion year-to-date. Qatar Energy, Bank of China, ICBC, Agricultural Bank of China and CCB Asia didn’t respond to requests for comment. Among the recent deals that have made their way through the pipeline, Kuwait’s Boubyan Bank in August secured a $300 million loan with HSBC, Bank of China, ICBC and Bank Islam Brunei Darussalam. Qatar National Bank, meanwhile, is seeking a $2 billion loan, with ICBC as one of the mandated lead arrangers and bookrunners.
Qatar has emerged as a diplomatic conduit between the US and Iran, particularly in attempts to reopen the Strait of Hormuz. But it has also been a target for Iran, highlighting the risks facing the entire region.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing