Bank Loans

9 Months Ended

Sep. 30, 2013

Bank Loans [Abstract]

BANK LOANS

NOTE 5 BANK LOANS

Bank loans represent amounts due to various banks and are generally due on demand or within one year. These loans can be renewed with the banks. Bank loans consisted of the following at September 30, 2013 and December 31, 2012:

Bank	September 30, 2013		December 31, 2012
Nanjing Bank	$	17,531,424	$	16,743,277
Bank of Communications		9,774,845		6,953,834
Shanghai Pudong Development Bank		6,504,000		7,014,833
China Minsheng Bank	5,997,973			4,239,800
HSBC		5,398,857		5,414,316
Hua xia Bank		1,626,000		-
Ping An Bank		1,457,565		-
Everbright Bank		-		3,166,000
Bank of China		-		3,387,620
	$	48,290,664	$	46,919,680

On June 14, 2013, Goldenway entered into a line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $8.13 million (RMB50 million). The line of credit is collateralized by the Company’s property and equipment. As of September 30, 2013, Goldenway had borrowed $8.13 million (RMB50 million) under this line of credit from Nanjing Bank with an annual interest rate ranging from 5.88% to 6.16% and due on various dates from October 2013 to March 2014. Approximately $1.63 million (RMB10 million) was repaid subsequent to September 30, 2013.

On June 14, 2013, Ever-Glory Apparel entered into a line of credit agreement for approximately $9.77 million (RMB60 million) with Nanjing Bank and guaranteed by Jiangsu Ever-Glory. As of September 30, 2013, Ever-Glory Apparel had borrowed $3.25 million (RMB 20 million) under this line of credit with annual interest rates from 5.88% to 6.6% and due from January to September 2014. Ever-Glory Apparel had also borrowed $4.52 million from Nanjing Bank with annual interest rates ranging from 2.1% to 2.2% and due on various dates from October to December 2013, and collateralized by approximately $6.46 million of accounts receivable from wholesale customers.  At September 30, 2013, approximately $2.0 million was unused and available under this line of credit. Approximately $1.67 million was repaid subsequent to September 30, 2013.

On April 10, 2012, LA GO GO entered into a revolving line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $3.25 million (RMB20 million). The line of credit is guaranteed by Jiangsu Ever-Glory and Mr. Kang. As of September 30, 2013, LA GO GO had borrowed $1.63million (RMB10 million) under this line of credit with annual interest rates ranging from 6.16% to 6.44% and due on various dates from October 2013 to January 2014. At September 30, 2013, approximately $1.62 million (RMB10 million) was unused and available under this line of credit. Approximately $0.81 million was repaid subsequent to September 30, 2013.

On January 4, 2011, Goldenway entered into a revolving line of credit agreement for approximately $6.5 million (RMB40 million) with Shanghai Pudong Development Bank. As of September 30, 2013, Goldenway had borrowed the maximum amount available under the line of $6.50 million (RMB40 million), with an annual interest rate of 6.3%. These loans are collateralized by certain properties and land use rights of Goldenway, and are due in November 2013.

As of September 30, 2013, Ever-Glory Apparel had borrowed $5.2 million (RMB32 million) from the Bank of Communications with an annual interest rate of 6.3% and due in February 2014. The loan is guaranteed by Jiangsu Ever-Glory and Mr. Kang.  This loan is also collateralized by assets of Jiangsu Ever-Glory’s equity investee, Nanjing Knitting, under a collateral agreement executed among the Company, Jiangsu Ever-Glory, Nanjing Knitting and the bank. Ever-Glory Apparel had also borrowed $2.95 million from the Bank of Communications with an annual interest rate of 3.4%, due on various dates from October to December 2013, and collateralized by approximately $4.2 million of accounts receivable from wholesale customers.

As of September 30, 2013, LA GO GO had borrowed $1.62 million (RMB10 million) from the Bank of Communications with an annual interest rate of 6.3% and due in July 2014. This loan is guaranteed by Jiangsu Ever-Glory and Mr. Kang.

On July 29, 2011, Ever-Glory Apparel and Perfect Dream collectively entered into a secured banking facility agreement for a combined revolving import facility, letter of credit, invoice financing facilities and a credit line for treasury products of up to $7.0 million with the Nanjing Branch of HSBC (China) Company Limited (“HSBC”). This agreement is guaranteed by the Company and Mr. Kang. As of September 30, 2013, Ever-Glory Apparel had borrowed $5.4 million ($0.6 million and RMB 30 million) from HSBC with annual interest rates ranging 5.6% to 5.88% and due on various dates from October to December 2013, and collateralized by approximately $7.7 million of accounts receivable from international wholesale customers. These bank loans are to be repaid upon receipt of payments from customers. As of September 30, 2013, approximately $1.6 million was unused and available. Approximately $2.39 million was repaid subsequent to September 30, 2013.

As of September 30, 2013, Ever-Glory Apparel had borrowed $2.75 million from China Minsheng Bank, with annual interest rate of 2.93% and due in November 2013 and collateralized by approximately $3.9 million of accounts receivable from wholesale customers.

As of September 30, 2013, LA GO GO had borrowed $3.25 million (RMB 20 million) from China Minsheng Bank, with annual interest rate of 6.3% and due in August 2014. This loan is guaranteed by Ever-Glory Apparel and Mr. Kang. 

As of September 30, 2013, Ever-Glory Apparel had borrowed $1.46 million from Ping An Bank, with annual interest rate of 6.3%, due in November 2013, and collateralized by approximately $2.09 million of accounts receivable from wholesale customers.

As of September 30, 2013, Ever-Glory Apparel had borrowed $1.63 million (RMB 10 million) from Hua Xia Bank, with annual interest rate of 6.6% and due in April 2014. This loan is guaranteed by Goldenway.

Total interest expense on bank loans amounted to $757,390, $2,285,614, $449,413 and $1,454,157 for the three and nine months ended September 30, 2013 and 2012, respectively.