AA Signs HK$6 Billion Syndicated Loan

(HONG KONG, 27 October 2004) - The Airport Authority (AA) today signed a HK$6 billion dual-tranche syndicated loan facility with 22 leading local and international banks, following a strong demand and oversubscription during the syndication.

The loan facility comprises two tranches: a HK$3 billion 3-year revolving credit facility and a HK$3 billion 5-year term / revolving credit facility with amortisation, at an all-in costs of 17 basis points and 22 basis points over Hong Kong Interbank Offered Rates, respectively.

Part of the loan will be used to re-finance the HK$6 billion return of capital to the Hong Kong SAR Government made in September this year, with the balance used to finance working capital and meet funding requirement arising from the increase in passenger and air cargo traffic.

The syndication was well received by the banking community with a total commitment of over HK$14 billion. The final issue size was set at HK$6 billion after due consideration.

Speaking at the signing ceremony, AA Chief Executive Officer Dr. David J Pang said, "The enthusiastic response to the syndication is very encouraging for Hong Kong International Airport. It demonstrates a vote of confidence in the growth prospect of the airport and our efforts to maintaining the airport's competitiveness."

Growth in both passenger and air cargo traffic has been strong. In the first six months of the financial year ended 30 September 2004, passenger throughput rose to about 19 million, up 12.4 per cent compared with the preceding six-month period in the previous financial year. By similar comparison, the total cargo tonnage of the previous six months grew by 4.8 per cent to 1.5 million. Moreover, new monthly records for passenger traffic and air cargo throughput were set in August and September, amounting to 3.5 million people and 280,000 tonnes respectively.

Commenting on the syndication, Finance Director Mr. Raymond Lai said, "We are glad that our syndication was well received by prominent local and international financial institutions. With their full backing, we are in a good position to source competitive priced funding to support business operation and maintain sustainable growth."

The list of participating banks is as follows:

Coordinating Arrangers

Bank of China (Hong Kong) Limited

HSBC

Standard Chartered Bank

Citigroup

Senior Lead Managers

Hang Seng Bank Limited

Mizuho Corporate Bank, Ltd.

Tai Fung Bank Limited

The Bank of Tokyo-Mitsubishi, Ltd.

Calyon

Commonwealth Bank of Australia

DBS Bank Ltd.

Nanyang Commercial Bank, Limited

Rabobank International, Hong Kong Branch

The Royal Bank of Scotland plc

Sumitomo Mitsui Banking Corporation

UFJ Bank Limited, Hong Kong Branch

Wing Lung Bank, Limited

Bank of Communications, Hong Kong Branch

Lead Managers

Banco Bilbao Vizcaya Argentaria S.A. , Hong Kong Branch

Banca di Roma S.p.A. - Hong Kong Branch

Dah Sing Bank, Limited

International Bank of Asia Limited

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Airport Authority Hong Kong

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