Bank of China and Volvo (China) Investment Co., Ltd. signed a Master Co-operation Agreement in Beijing on March 2nd, 2004.
According to the Agreement, Bank of China will provide Volvo (China) and its branch and subsidiary companies with credit support in short and long term loans, project loans, acceptance of bills, guarantees, letters of credit, among others. In addition, Bank of China will offer comprehensive financial services including cash management, settlement of foreign exchange, receivables, banker's acceptance, settlement and sales of forward exchange, and other financial services.
The second part of the Agreement concerns the creation of effective and competitive financial solutions for AB Volvo's dealers and customers. Under this arrangement, Bank of China may provide dealers with inventory, real estate and working capital loans. Also, customers may therefore have financial support for their purchase of products sold by the Volvo Group, namely, Volvo construction equipment, and Volvo buses and trucks with the brand names of Volvo, Renault and Mack.
The reaching of this Master Co-operation Agreement will enhance the overall co-operation that has existed between the two enterprises, establish a strategic relationship between Bank of China and the enterprises invested by AB Volvo in the Chinese mainland, lay a durable foundation for AB Volvo's further expansion in the Chinese market and provide financial support for its further development. This agreement will have a profound and lasting influence on the co-operation between Bank of China and AB Volvo.
Volvo (China) Investment Co. Ltd., a subsidiary wholly owned by AB Volvo, has invested in Shanghai Sunwin Bus Co., Ltd., Xi'an Silver Bus Corporation, Jinan Huawo Truck Co., Ltd. and other Sino-foreign joint ventures in China. In addition, Volvo (China) owns two wholly funded enterprises: Volvo Construction Equipment (China) Co., Ltd. and Volvo Parts (Shanghai) Co., Ltd.
AB Volvo, headquartering in Gothenburg, Sweden, is one of the largest industrial groups in Northern Europe and its primary products include heavy trucks, buses, engineering machinery, industrial engines and ship and aircraft engines. AB Volvo is a Fortune 500 company and a world-wide leading auto maker.
Prior to entering into this Agreement, Bank of China and AB Volvo had developed active and close co-operation. Bank of China, Shaanxi Branch signed a Strategic Co-operation Agreement with Xi'an Silver Bus Corporation; and Bank of China, Singapore Branch also provided credit extension facilities to Volvo Treasury Asia Ltd.
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