Annual report pursuant to Section 13 and 15(d)

Bank Loans

v3.8.0.1
Bank Loans
12 Months Ended
Dec. 31, 2017
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, 2017 and December 31, 2016, short-term bank loans consisted of the following:

 

    December 31,
2017
    December 31,
2016
 
Loan from Fujian Haixia Bank, due on September 14, 2017 with annual interest rate of 6.960% at December 31, 2017 and December 31, 2016, collateralized by Pingtan Fishing’s 17 fishing vessels   $ -     $ 4,324,636  
Loan from Fujian Haixia Bank, due on September 14, 2018 with annual interest rate of 7.178% at December 31, 2017, collateralized by Pingtan Fishing’s 17 fishing vessels     3,826,023       -  
Loan from Fujian Haixia Bank, due on September 30, 2018 with annual interest rate of 7.178% at December 31, 2017 and December 31, 2016, collateralized by Pingtan Fishing’s 17 fishing vessels     765,205       -  
Loan from Fujian Haixia Bank, due on September 22, 2017 with annual interest rate of 1.529% at December 31, 2017 and 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, 2017 and 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 London Interbank Offered Rate (“LIBOR”)(1) plus 230 basis points (3.211% at December 31, 2017 and 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, and repaid on due date     -       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, 2017 and 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, and repaid on due date     -       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, 2017 and 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, and repaid on due date     -       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, 2017 and 2016), secured by the Company’s restricted cash which is a deposit with the lender of approximately $1.0 million (RMB 6.5 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, 2017 and 2016), secured by the Company’s restricted cash which is a deposit with the lender of approximately $0.5 million (RMB 3.3 million) and collateralized by a related party’s two vessels     -       2,500,000  
Loan from China Development Bank, due on March 8, 2018 with variable annual interest rate based on LIBOR(1) plus 230 basis points (3.721% at December 31, 2017), secured by the Company’s restricted cash which is a deposit with the lender of approximately $1 million (RMB 6.5 million) and collateralized by seven vessels     5,000,000       -  
Loan from China Development Bank, due on April 24, 2018 with variable annual interest rate based on LIBOR(1) plus 230 basis points (3.721% at December 31, 2017), secured by the Company’s restricted cash which is a deposit with the lender of approximately $0.7 million (RMB 4.6 million) and collateralized by four vessels     3,500,000       -  
Loan from Fujian Haixia Bank, due on September 11, 2018 with annual interest rate of 2.990% at December 31, 2017, collateralized by Pingtan Fishing’s 17 fishing vessels     1,509,750       -  
    $ 14,600,978     $ 21,554,636  

 

(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, 2017 and December 31, 2016, long-term bank loans consisted of the following:

 

    December 31,
2017
    December 31,
2016
 
Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 4.750% and 4.900% at December 31, 2017 and 2016, respectively, collateralized by Hong Long’s investment in equity interest of a China local bank   $ -     $ 5,852,674  
Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 4.750% and 4.900% at December 31, 2017 and 2016, respectively, collateralized by Fujian International Trading and Transportation Co., Ltd.’s investment in equity interest of a China local bank     -       1,153,236  
Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 4.750% and 4.900% at December 31, 2017 and 2016, respectively, guaranteed by Hong Long     -       4,742,684  
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, 2017 and December 31, 2016, guaranteed by Xinrong Zhuo and Ping Lin and collateralized by 2 fishing vessels and collateralized by two related parties’ investments in equity interest of one PRC local banks.     14,538,888       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, 2017 and December 31, 2016, guaranteed by Xinrong Zhuo, Honghong Zhuo, Mr. and Mrs. Zhiyan Lin and 6 fishing vessels     8,646,812       9,370,045  
Total long-term bank loans   $ 23,185,700     $ 39,137,956  
Less: current portion     (5,968,596 )     (17,298,544 )
Long-term bank loans, non-current portion   $ 17,217,104     $ 21,839,412  

 

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

 

Due in twelve-month periods ending December 31,   Principal  
2018   $ 5,968,596  
2019     6,045,116  
2020     4,591,228  
2021     1,606,930  
2022     1,759,971  
Thereafter     3,213,859  
    $ 23,185,700  
Less: current portion     (5,968,596 )
Long-term liability   $ 17,217,104  

 

The weighted average interest rate for short-term bank loans was approximately 4.4%, 4.2% and 3.2% for the years ended December 31, 2017, 2016 and 2015, respectively.

 

The weighted average interest rate for long-term bank loans was approximately 5.0%, 6.7% and 5.7% for the years ended December 31, 2017, 2016 and 2015, respectively.

 

For the years ended December 31, 2017, 2016 and 2015, interest expense related to bank loans amounted to $2,606,822, $3,011,359 and $3,630,200, respectively, of which, $203,609, $1,039,092 and $0 was capitalized to construction-in-progress, respectively.