Annual report pursuant to Section 13 and 15(d)

Bank Loans

v3.6.0.2
Bank Loans
12 Months Ended
Dec. 31, 2016
Bank Loans [Abstract]  
BANK LOANS

NOTE 11 – BANK LOANS

 

Short-term bank loans

 

Short-term bank loans represent the amounts due to various banks that are due within one year. These loans can be renewed with the banks upon maturities. At December 31, 2016 and 2015, short-term bank loans consisted of the following:

 

    December 31, 
2016
    December 31, 2015  
Loan from China Development Bank, due on February 11, 2016 with variable annual interest rate based on London Interbank Offered Rate (“LIBOR”)(1) plus 245 basis points (3.395% at December 31, 2015), guaranteed by Xinrong Zhuo, Honghong Zhuo, Zhiyan Lin and Shuhui Ke and repaid on due date   $ -     $ 7,000,000  
Loan from China Development Bank, due on November 25, 2016 with variable annual interest rate based on LIBOR(1) plus 230 basis points (2.941% at December 31, 2015), secured by the Company’s restricted cash which is a deposit with the lender of approximately $0.8 million  (RMB 5.12 million) and collateralized by a related party’s land use right and repaid on due date     -       4,000,000  
Loan from China Development Bank, due on December 9, 2016 with variable annual interest rate based on LIBOR(1) plus 230 basis points (3.049% at December 31, 2015), secured by the Company’s restricted cash which is a deposit with the lender of approximately $0.8 million (RMB 5.12 million) and collateralized by a related party’s land use right and repaid on due date     -       4,000,000  
Loan from Fujian Haixia Bank, due on September 7, 2016 with annual interest rate of 7.360% at December 31, 2015, collateralized by Pingtan Fishing's 17 fishing vessels and repaid on due date     -       4,621,998  
Loan from Fujian Haixia Bank, due on September 13, 2017 with annual interest rate of 6.960% at December 31, 2016, collateralized by Pingtan Fishing’s 17 fishing vessels     4,324,636       -  
Loan from Fujian Haixia Bank, due on September 20, 2016 with annual interest rate of 1.621% at December 31, 2015, collateralized by Pingtan Fishing’s 17 fishing vessels and repaid on due date     -       2,349,440  
Loan from Fujian Haixia Bank, due on September 22, 2017 with annual interest rate of 1.529% at December 31, 2016, collateralized by Pingtan Fishing’s 17 fishing vessels     1,150,000       -  
Loan from Fujian Haixia Bank, due on October 10, 2017 with annual interest rate of 1.739% at December 31, 2016, collateralized by Pingtan Fishing’s 17 fishing vessels     1,080,000       -  
Loan from China Development Bank, due on March 21, 2017 with variable annual interest rate based on LIBOR(1) plus 230 basis points (3.211% at December 31, 2016), secured by the Company’s restricted cash which is a deposit with the lender of approximately $0.6 million (RMB 4 million) and collateralized by a related party’s land use right     3,000,000       -  
Loan from China Development Bank, due on April 18, 2017 with variable annual interest rate based on LIBOR(1) plus 230 basis points (3.204% at December 31, 2016), secured by the Company’s restricted cash which is a deposit with the lender of approximately $0.6 million (RMB 4 million) and collateralized by a related party’s land use right     3,000,000       -  
Loan from China Development Bank, due on April 18, 2017 with variable annual interest rate based on LIBOR(1) plus 230 basis points (3.257% at December 31, 2016), secured by the Company’s restricted cash which is a deposit with the lender of approximately $0.3 million (RMB 2 million) and collateralized by a related party’s land use right     1,500,000       -  
Loan from China Development Bank, due on August 22, 2017 with variable annual interest rate based on LIBOR(1) plus 230 basis points (3.510% at December 31, 2016), secured by the Company’s restricted cash which is a deposit with the lender of approximately $1.0 million (RMB 6.7 million) and collateralized by a related party’s two vessels     5,000,000       -  
Loan from China Development Bank, due on December 9, 2017 with variable annual interest rate based on LIBOR(1) plus 230 basis points (3.593% at December 31, 2016), secured by the Company’s restricted cash which is a deposit with the lender of approximately $0.5 million (RMB 3.5 million) and collateralized by a related party’s two vessels     2,500,000       -  
    $ 21,554,636     $ 21,971,438  
(1) Represents six-month LIBOR rate on the loan commencement date.

 

Long-term bank loans

 

Long-term bank loans represent the amounts due to various banks lasting over one year. Usually, the long-term bank loans cannot be renewed with these banks upon maturities. At December 31, 2016 and 2015, long-term bank loans consisted of the following:

 

    December 31, 
2016
    December 31, 2015  
Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 4.900% and 4.750% at December 31, 2016 and 2015, respectively, collateralized by Hong Long's investment in equity interest of a China local bank   $ 5,852,674     $ 11,832,314  
 Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 4.900% and 4.750% at December 31, 2016 and 2015, respectively, collateralized by Fujian International Trading and Transportation Co., Ltd.'s investment in equity interest of a China local bank     1,153,236       2,310,999  
 Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 4.900% and 4.750% at December 31, 2016 and 2015, respectively, guaranteed by Hong Long     4,742,684       9,937,295  
 Loan from The Export-Import Bank of China, due on various dates until January 30, 2023 with annual interest rate of 4.900% at December 31, 2016, guaranteed by Huanghai Ship Construction Co., Ltd, Xinrong Zhuo and Ping Lin and collateralized by 2 fishing vessels under construction and collateralized by three related parties’ investments in equity interest of two PRC local banks     18,019,317       -  
 Loan from China Development Bank, due on various dates until November 27, 2023 with annual interest rate of 5.145% at December 31, 2016 and 2015, guaranteed by Xinrong Zhuo, Honghong Zhuo, Mr. and Mrs. Zhiyan Lin and 6 fishing vessels     9,370,045       11,169,827  
Total long-term bank loans   $ 39,137,956     $ 35,250,435  
Less: current portion     (17,298,544 )     (12,679,680 )
Long-term bank loans, non-current portion   $ 21,839,412     $ 22,570,755  

 

The future maturities of long-term bank loans are as follows:

 

Due in twelve-month periods ending December 31,   Principal  
2017   $ 17,298,544  
2018     5,622,027  
2019     5,694,104  
2020     4,324,636  
2021     1,513,623  
Thereafter     4,685,022  
    $ 39,137,956  
Less: current portion     (17,298,544 )
Long-term liability   $ 21,839,412  

  

The weighted average interest rate for short-term bank loans was approximately 4.2%, 3.2% and 3.6% for the years ended December 31, 2016, 2015 and 2014, respectively.

 

The weighted average interest rate for long-term bank loans was approximately 6.7%, 5.7% and 6.8% for the years ended December 31, 2016, 2015 and 2014, respectively.

 

For the years ended December 31, 2016, 2015 and 2014, interest expense related to bank loans amounted to $3,011,359, $3,630,200 and $5,652,572, respectively, of which, $1,039,092, $0 and $836,902 was capitalized to construction-in-progress, respectively.