China's CITIC Bank gives 15 bln yuan credit to AVIC

BEIJING, March 23 Mon Mar 23, 2009 9:07am EDT

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BEIJING, March 23 (Reuters) - China's CITIC Bank (601998.SS) (0998.HK) has granted a 15 billion yuan ($2.2 billion) credit line to the national aircraft maker, Aviation Industry Corp of China (AVIC), state media reported on Monday.

The credit line is part of a partnership between the two that will also see CITIC provide investment bank and asset management services to AVIC, the official Xinhua news agency reported.

"Aviation is a strategic industry for our country's development, and the restructuring of AVIC has given CITIC Bank a vast opportunity for business cooperation," an unnamed bank official was quoted as saying.

AVIC was created last year out of a merger of two state aircraft makers with sights set on big projects, including a locally developed regional jet, to reduce China's reliance on Boeing (BA.N) and Airbus EAD.PA.

Combined 2008 sales for the two companies that merged were 166 billion yuan ($24.3 billion) in 2008, compared with $60.1 billion for Boeing. ($1=6.833 Yuan) (Reporting by Simon Rabinovitch; Editing by Jon Loades-Carter)

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