HBL
Few lenders were quicker to spot the benefits of China’s Belt and Road Initiative than Habib Bank Ltd. Over the last decade, HBL has been Beijing’s go-to financial partner in Pakistan, and a vital player in its efforts to draw south Asia tightly into its economic and financial orbit.
It matters that HBL has heft at home. It is Pakistan’s largest lender, with 1,700 branches, and its most outward-looking, with branches in more than 20 countries. Its relationship in and with China is not new: HBL opened its first branch in the People’s Republic in 2005. The launch of the BRI in 2013 coincided with the rollout by HBL of three onshore China coverage desks, in Karachi, Lahore and Islamabad, as well as a coverage team located in the Chinese-controlled Gwadar Port free trade zone, opposite the coast of Oman.
The first branch the bank opened in China was in Urumqi, the largest city in the west of the country, in October 2018, and it kicked off its renminbi business in August 2019, the same month it filed with the China Banking and Insurance Regulatory Commission to upgrade its Beijing representative office to full branch status.
HBL’s value to China is underlined by the fact that it is the only financial institution granted membership bank status by the Shanghai Cooperation Organisation’s Interbank Association.
If anything, HBL has doubled down over the last year on its commitment to Asia’s largest economy. It was the lead sponsor of the Gwadar Expo 2019 and hosted a conference on the internationalization of the renminbi. Its president and chief executive, Muhammad Aurangzeb, was a keynote speaker at ICBC’s Belt and Road Bankers Roundtable in May 2019.
Then there’s the usual roster of deals, led by Thar Energy’s $520 million coal-based power plant, signed in December 2018. HBL was exclusive financial adviser and local-currency-mandated lead arranger on a transaction that blended local and foreign currency debt, and included backing from China Development Bank.
The bank was also exclusive financial adviser and local- and foreign-currency-mandated lead arranger on a $230 million cement plant for local operator Saif Cement that was part-financed by China Development Bank; in addition, it was the financial adviser to a $1.66 billion high-voltage power transmission line linking Matiari with Lahore, to be built by a unit of the State Grid Corporation, China Electric Power Equipment and Technology.