Morales & Besa advised Bank of China in obtaining the final approval and license to start operations of its local branch in Chile.

April 4, 2018

Morales & Besa successfully advised Bank of China in obtaining the final approval and license to start operations of its local branch “Bank of China, Agencia en Chile”, from the SBIF, the Chilean banking regulator and supervisory agency.

The advice included drafting and negotiation of a Master Financing Agreement (“Master Agreement”), for an estimated maximum amount of up to USD $ 7.5MM approx. for the construction tranche, and the equivalent in Chilean pesos (“CLP”) of up to USD $2MM for VAT tranche. The Master Agreement set forth the terms and conditions required for the financing of the existing and future projects of the portfolio. In addition to the Master Agreement, Morales & Besa advised the Bank in drafting and negotiation of all the financing documents for 1 of the 3 projects of the portfolio, all of them in operation phase and located in the Fifth Region. The advice also included an environmental, corporate, project contracts, mining and contractual due diligence process and the tax analysis of project contracts and project information, for purposes of determining the feasibility of an early reimbursement of the VAT related to the construction of such projects.

The resolution of the SBIF authorizing the start-up of operations of Bank of China, Agencia en Chile was issued on 12 March 2018, signalling the successful completion of a 2 years process comprising several stages of incremental exigencies of the regulator. The first, the provisional approval, was granted by the SBIF on November 23, 2016. Then, on August 16, 2017, the SBIF approved the legal set up of Bank of China’s agency and finally on 12 March 2016 the SBIF gave its approval to the systems, staffing and various operational components for the branch to start its operations.

This is the third banking license granted by the SBIF in the last three years.

Bank of China Ltd. Is the oldest bank in China and one of the four largest commercial banks owned by the State of the People’s Republic. It currently operates in more than 50 countries and regions.

Morales & Besa team involved in this transaction was formed by partner Guillermo Morales, with the participation of Ignacio Menchaca and María José Rojas.