November 20, 2017 / 12:04 PM / 2 years ago

China's HNA asks banks to extend $448 mln loan maturity -LPC

HONG KONG, Nov 20 (Reuters) - Chinese conglomerate HNA Group has asked its lenders to extend the maturity of a HK$3.5 billion ($448 million) loan by three months, sources close to the situation told Reuters Loan Pricing Corp (LPC) on Monday.

The one-year loan, which partly funded the indebted group’s first land purchase in Hong Kong, comes due on Friday, the Thomson Reuters publication reported, adding that the request for the extension was made last week.

It was not immediately clear whether the three lenders — Hong Kong-based Bank of East Asia, Nanyang Commercial Bank and Chong Hing Bank — will agree to HNA’s request, LPC reported.

HNA’s request for an extension of the loan maturity comes ahead of a slew of repayment obligations and concerns about rising financing costs at the indebted airline-to-property conglomerate.

Pressure on its finances has increased after Beijing told banks in June to review their credit exposure to a handful of domestic companies including HNA.

The group has been on a debt-fuelled acquisition spree, spending $50 billion over the past two years, sparking closer scrutiny of its opaque ownership and use of leverage.

HNA said in an emailed statement to LPC that discussions with banks about the $448 million loan were in progress and that it was not yet in a position to reveal details. The three lenders declined to comment.

The Chinese group was also in talks with Hong Kong-based branches of some Chinese banks for new loans and at least one has agreed to provide some funds, LPC reported, citing the same sources. ($1 = 7.8113 Hong Kong dollars) (Reporting by Yan Jiang of Reuters Loan Pricing Corp; Writing by Sumeet Chatterjee; Editing by David Goodman)

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