Targeted Financial Support, Shanghai Pudong Development Bank: Leveraging International Platform Advantages Investment Bank | Belt and Road | International

When watching the Qatar World Cup, can you think of the Chinese power behind it?

The strong strength of China's construction provides protection for the World Cup stadiums. The 800 MW photovoltaic project used to generate electricity for the Qatar World Cup stadium was awarded the bid by China Power Construction Group Guizhou Engineering Co., Ltd. This project is the world's third-largest single cell photovoltaic power plant, expected to provide Qatar with approximately 1.8 billion kilowatt hours of clean electricity annually. The project started construction in July 2020, and the construction team overcame frequent sandstorms and the harsh environmental impact of long-term high temperatures, successfully achieving the goal of full capacity grid connection before the start of the World Cup.

The full support of Chinese finance will safeguard the construction of China. Pudong Development Bank actively responded to the "the Belt and Road" initiative and strongly supported the financing needs of POWERCHINA with professional financial services. During the construction period, Pudong Development Bank opened a domestic letter of credit for China Electric Power Construction to assist in accelerating project construction and purchasing photovoltaic equipment. Pudong Development Bank also provides a "package" of financial services, covering various products such as bank notes, guarantees, letters of credit, and bills of exchange, to meet the foreign currency settlement needs of China Electric Power Construction Corporation's equipment procurement under the engineering general contracting model, ensuring smooth financial services and building a "financial support" for the smooth construction of photovoltaic power stations.

Qatar Alkasa 800 MW Photovoltaic Project

Since the "the Belt and Road" initiative was put forward, Shanghai Pudong Development Bank has always actively responded to the national call to build a "four in one" international business platform for offshore banks, free trade finance, overseas branches and overseas investment banks, build a cross-border financial service pattern integrating domestic and foreign investment banks, support the energy and infrastructure construction of countries along the "the Belt and Road", and help Chinese enterprises "go global" to expand cross-border business. In the process of forging ahead, Shanghai Pudong Development Bank has continuously accumulated practical experience in financial services for the real economy, continuously improved the level of service for the "the Belt and Road" initiative, and stepped to new levels.

Platform, take a step forward

As a national joint-stock commercial bank headquartered in Shanghai, Shanghai Pudong Development Bank has always spared no effort in expanding its international market and enhancing its global influence with a forward-looking international perspective.

As of the end of June 2023, the total asset size of Pudong Development Bank has reached 8.93 trillion yuan, with 42 first level branches and more than 1700 business institutions established both domestically and internationally. The domestic branches cover all provincial-level administrative regions in mainland China, while the overseas branches include the Hong Kong branch, Singapore branch, and London branch. The bank has more than 60000 employees and has established a comprehensive and international business service pattern covering multiple business formats such as trusts, funds, wealth management, financial leasing, overseas investment banks, rural banks, and currency brokers. Ranked 18th on the Banker's Global 1000 list for three consecutive years. Meanwhile, Shanghai Pudong Development Bank is one of the few commercial banks in China that has received investment grade or above ratings from the three major international rating agencies.

Over the years, Pudong Development Bank has actively responded to the "the Belt and Road" initiative, making it clear that the "four in one" international platform of offshore banks, free trade finance, overseas branches and Bank of Pudong International is the main docking mechanism for serving the "the Belt and Road" initiative, giving full play to the linkage and innovation advantages of Pudong Development International's business, and constantly improving the financial service level of the "the Belt and Road" initiative.

Offshore banks are the first mover advantage of Shanghai Pudong Development Bank. Shanghai Pudong Development Bank was approved by the People's Bank of China in June 2002 to operate offshore business in China, making it one of only four licensed offshore banks in the country. The offshore banks can give full play to their advantages of being based at home and serving the world, and provide portfolio services such as account settlement, financing, M&A, guarantee, fund management, risk control, financial advisory, etc. for the enterprise layout of the "the Belt and Road".

Free trade finance is the innovation home of Shanghai Pudong Development Bank. Pudong Development Bank has closely followed the pace of financial innovation in the national free trade zone, and has been approved for FT free trade accounting business qualifications in Shanghai, Hainan, and Shenzhen. It has now become one of the banks with the highest coverage of financial services in the free trade zone. Relying on the free trade FT account system, Shanghai Pudong Development Bank focuses on docking cross-border service demand in the construction of the "the Belt and Road" through innovative models such as settlement and exchange facilitation, cross-border two-way RMB capital pool, etc.

Overseas branches are the highways of Shanghai Pudong Development Bank. Pudong Development Bank has established three overseas branches in Hong Kong, Singapore, and London. By giving full play to its leading advantages in bond and syndicated business in the Asia Pacific market, Hong Kong Branch actively matches the financing needs of enterprises in the "the Belt and Road" layout; As an important force serving the "the Belt and Road", Singapore Branch, based in Singapore and radiating to Southeast Asia, provides eight regional small currencies including the Philippine peso, Thai baht, Malaysian ringgit, Indonesian rupiah, Indian rupee, New Zealand dollar and Brazilian real as well as corresponding foreign exchange derivatives, and sets up a bulk commodity trade center, whose business scope has gradually covered the surrounding countries along the "the Belt and Road"; Relying on the London International Financial Center, London Branch has built a global financial service network to provide diversified financial services such as green finance for Chinese enterprises to layout the "the Belt and Road" and the European market.

Puyin International is the overseas pioneer of Shanghai Pudong Development Bank. As an overseas licensed investment bank wholly-owned by SPDB, SPDB International strives to provide one-stop, comprehensive and diversified financial services such as recommendation listing, mergers and acquisitions, bond underwriting, stock underwriting, financial advisory, asset management, and direct investment, so as to realize the close linkage and effective complementarity between investment banking and commercial banking in the process of serving the "the Belt and Road" layout of enterprises.

Seize opportunities firmly

Under the "the Belt and Road" initiative, more and more Chinese funded enterprises are going abroad to actively deploy in countries and regions along the line. Whether it is cross-border trade, investment and factory building, or mergers and acquisitions, a large number of financial service needs are derived.

For Shanghai Pudong Development Bank, such a demand is both a responsibility and an opportunity. Based on the deep foundation of cooperation with Chinese enterprises in China, SPDB firmly grasped the opportunity of the "the Belt and Road" to provide financial service support for enterprises' overseas projects in an all-round way to achieve a win-win situation for banks and enterprises.

In terms of cross-border trade, under the "the Belt and Road" initiative, enterprises will accelerate the layout of countries and emerging markets along the Belt and Road, and the demand for financial services in cross-border settlement, financing, currency exchange, exchange rate hedging and other aspects is growing. To this end, Pudong Development Bank provides targeted cross-border trade settlement services for enterprises in both domestic and foreign currencies, distinctive trade financing services, exchange rate hedging services such as forward, options, and swaps, as well as emerging cross-border payment services such as cross-border e-commerce.

In terms of cross-border fund management, with the deepening of overseas layout of enterprises, their cross-border fund arrangements are becoming increasingly complex, and the demand for collecting funds from domestic and foreign member enterprises, effectively improving fund concentration, and coordinating global cross-border fund management is becoming more urgent. To this end, Pudong Development Bank provides services such as local and foreign currency fund pools to establish two-way channels for enterprises both domestically and internationally, achieving global integrated management of funds, and matching flexible cash management products to help enterprises maintain and increase the value of surplus funds.

In terms of overseas investment and financing, as the pace of "going out" deepens, enterprises have gradually developed from "going out of goods" to "going out of business entities", which is usually accompanied by financial needs such as overseas direct investment, cross-border mergers and acquisitions, and international engineering contracting. To this end, Pudong Development Bank actively provides cross-border project financing, merger and acquisition financing, syndicated loans, various foreign-related guarantees and other products and services for enterprises, while fully utilizing domestic and foreign, onshore, and domestic and foreign currency markets to help enterprises obtain low-cost funds globally.

In terms of cross-border RMB, with the continuous promotion of the "the Belt and Road" initiative, the acceptance and utilization rate of RMB have significantly increased. On the one hand, SPDB has clearly standardized cross-border RMB business by establishing effective policies and institutional mechanisms, on the other hand, it has gradually improved its service system, comprehensively arranged cross-border RMB trade settlement, investment and financing, securities investment, cross-border custody, personal finance and other fields, and assisted in the continuous breakthrough of RMB internationalization with more robust and comprehensive financial services. According to the statistics of the People's Bank of China, in the first quarter of 2023, the total cross-border RMB payment and receipt volume of Shanghai Pudong Development Bank reached 255.827 billion yuan, a significant increase of 52.17% compared to the same period last year. At the same time, Shanghai Pudong Development Bank actively implements the principle of "local currency priority" and adopts cross-border RMB as the settlement and valuation currency for trade settlement, investment and financing in the cross-border field. As of the end of the first quarter of 2023, Shanghai Pudong Development Bank's cross-border RMB settlement volume accounted for over 50% of the international settlement volume in domestic and foreign currencies.

In terms of foreign-related guarantees, since 2022, SPDB has issued more than 50 non-financial foreign-related guarantees for enterprises going global along the "the Belt and Road", involving foreign engineering construction and machinery equipment procurement in more than 20 countries along the "the Belt and Road", including Qatar, Ethiopia, Papua New Guinea and Pakistan. In the future, SPDB will continue to be committed to providing more professional and efficient financial services for the "the Belt and Road" going global enterprises.

In terms of cross-border logistics, as an important carrier for China to deepen economic and trade cooperation with countries along the "the Belt and Road", China Europe Express has always been a key service area of SPDB. In 2021, Shanghai Pudong Development Bank took the lead in launching a digital cross-border logistics and financial solution under the China Europe freight train scenario, and implemented it on the China Europe freight train "Chang'an" and "Shanghai". For the "Chang'an Express", Pudong Development Innovation has launched a service plan of "fund supervision+foreign currency collection"; As the first financial institution to connect with China's international trade single window and the operator of the Shanghai China Europe freight train and deploy foreign currency freight payment services online, Shanghai Pudong Development Bank provides fully online and intelligent foreign currency collection and payment services for booking enterprises, replacing traditional manual processes with intelligent recognition and automatic review, greatly simplifying the application process and significantly improving processing efficiency, providing strong financial support for the orderly operation of the Shanghai China Europe freight train.

Support, targeted

Focusing on the "the Belt and Road" initiative, Shanghai Pudong Development Bank has a targeted view around the national strategy. While accurately matching the needs of enterprises to support industrial development, it also uses projects to improve the livelihood of countries along the line. By the end of 2022, the accumulated credit support provided by SPDB to relevant enterprises in the "the Belt and Road" countries has exceeded 13 billion US dollars.

On the one hand, Pudong Development Bank focuses on serving national support industry clients in infrastructure, energy resources, external engineering contracting, and green areas. In 2017, Shanghai Pudong Development Bank participated in a syndicated loan financing for a hydropower project of a central enterprise in Cambodia, with a share of 39 million US dollars. As a key project of the "the Belt and Road" and Cambodia's energy construction, and a model of China Cambodia energy cooperation, the capacity of the power station accounts for one fifth of Cambodia's total installed capacity, which is of great significance for Cambodia to accelerate economic development and improve people's livelihood. In 2023, Shanghai Pudong Development Bank participated in a syndicated loan financing for a waste treatment and power generation project of a listed environmental new energy company in Vietnam, with a share of 20 million US dollars. The completion of the power generation project fills the gap of large waste incineration power stations in Hanoi, Vietnam, and will effectively improve the local living environment, becoming a demonstration project of Chinese private enterprises going to Vietnam and the green "the Belt and Road".

On the other hand, following the strategic goal of "carbon peak" and "carbon neutrality", Shanghai Pudong Development Bank focuses on the capital needs of new energy, new materials and other industrial customers to layout the "the Belt and Road". In 2022, Shanghai Pudong Development Bank issued an overseas syndicated loan of RMB 50 million and USD 8 million to a subsidiary of a new energy group in Indonesia, to meet the financing needs of the company's nickel cobalt smelting project in Indonesia and assist in the deep development of the company's lithium battery industry chain. In 2023, Shanghai Pudong Development Bank participated in a syndicated loan financing for an Indonesian nickel cobalt smelting project of a nickel full industry chain company, with a loan share of 1 billion yuan. This project is guided by the comprehensive utilization of laterite nickel resources, green development, and coordinated development of related industries, which has positive significance for deepening international production capacity cooperation.

At present, on the basis of giving full play to the due diligence of Singapore Branch in Southeast Asia projects and the advantages of domestic branches in high-quality customer resources, SPDB has focused on the investment of Chinese industry leading enterprises in Southeast Asia countries and regions through capacity transfer, global industrial chain supply chain layout and other ways, and has reserved a number of high-quality projects in countries along the "the Belt and Road" focusing on new energy, new materials and other fields. In the future, Shanghai Pudong Development Bank will actively promote the evaluation of high-quality projects based on its reserve projects, leverage its multi platform advantages in international business, and assist Chinese enterprises in their "going global" layout.

"For SPDB, supporting the 'the Belt and Road' initiative is a must answer question, and we will continue to enrich and improve the 'problem-solving ideas' in practice," said the relevant person in charge of SPDB. In the future, SPDB will continue to steadily promote international operations and improve the "the Belt and Road" financial service system. In terms of institution preparation, continue to apply for Frankfurt Branch, Luxembourg Subsidiary and Branch, Dubai Branch, and expand the coverage of the "the Belt and Road" service; In terms of interbank cooperation, strengthen cooperation with foreign counterparts, and expand the businesses of local customers in Southeast Asia, the Middle East and other countries along the "the Belt and Road", such as forfaiting, letter of guarantee, and syndicate; In terms of financial support, steadily promote foreign production capacity cooperation projects of high-quality state-owned enterprises and industry-leading private enterprises that have been approved by domestic regulatory authorities for foreign investment, and have been carried out in countries and regions along the "the Belt and Road" with stable political situation and sound laws and regulations; In terms of digital services, relying on the "SPD e-Sea Alliance" overseas digital customer expansion platform, we will establish an online interactive channel for foreign peers, effectively deliver the high-quality project information of Chinese enterprises' layout of the "the Belt and Road" to the financial institutions joining the platform, help enterprises more easily access localized financial services, and use the digital platform of SPDB to continue to empower financial services on the "the Belt and Road".