Bank Loans

6 Months Ended

Jun. 30, 2014

Bank Loans [Abstract]

BANK LOANS

NOTE 4 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 June 30, 2014 and December 31, 2013:

	June 30,		December 31,
Bank	2014		2013
Industrial and Commercial Bank of China	$	12,956,145	$	1,799,600
Nanjing Bank		10,422,414		18,526,618
Bank of Communications		9,181,755		9,245,108
Bank of Everbright		6,233,984		3,272,000
The Hong Kong and Shanghai Bank		5,551,067		3,499,552
Bank of China		5,111,053		8,210,699
China Minsheng Banking		3,248,000		4,953,069
Pin An Bank		2,675,281		2,196,102
Huaxia Bank		-		1,636,000
	$	55,379,699	$	53,338,748

On January 1, 2014, Goldenway entered into a line of credit agreement with Industrial and Commercial Bank of China, which allows the Company to borrow up to approximately $6.50 million (RMB40 million). These loans are collateralized by the Company’s property and equipment. As of June 30, 2014, Goldenway had borrowed $6.50 million (RMB40 million) under this line of credit with an annual interest rate of 6.24% and due on various dates from March to April 2015.

On January 1, 2014, Ever-Glory Apparel entered into a line of credit agreement for approximately $6.50 million (RMB40 million) with Industrial and Commercial Bank of China and guaranteed by Goldenway. As of June 30, 2014, Ever-Glory Apparel had borrowed $4.79 million (RMB 29.5 million) under this line of credit with an annual interest rate of 5.6% and due on various dates from November to December 2014. Ever-Glory Apparel had also borrowed $1.67 million from Industrial and Commercial Bank of China with annual interest rates ranging from 1.02% to 1.04% and due on various dates from July to October 2014, and collateralized by approximately $2.24 million of accounts receivable from wholesale customers. At June 30, 2014, approximately $0.04 million was unused and available under this line of credit. Approximately $0.44 million was repaid subsequent to June 30, 2014.

On June 14, 2013, Goldenway entered into a line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $8.12 million (RMB50 million). These loans are guaranteed by Jiangsu Ever-Glory International Group Corp. (“Jiangsu Ever-Glory”), an entity controlled by Mr. Kang, the Company’s Chairman and Chief Executive Officer. These loans are also collateralized by the Company’s property and equipment. As of June 30, 2014, Goldenway had borrowed $4.06 (RMB25 million) under this line of credit from Nanjing Bank with an annual interest rate of 6.16% due on August 2014. At June 30, 2014, approximately $4.06 million was unused and available under this line of credit. Approximately $4.06 million was repaid subsequent to June 30, 2014.

On June 14, 2013 and renewed on July 6, 2014, Ever-Glory Apparel entered into a line of credit agreement for approximately $9.74 million (RMB60 million) with Nanjing Bank and guaranteed by Jiangsu Ever-Glory, Mr. Kang and Goldenway. As of June 30, 2014, Ever-Glory Apparel had borrowed $1.62 million (RMB 10 million) under this line of credit with an annual interest rate of 6.6% and due on September 2014. Ever-Glory Apparel had also borrowed $2.30 million from Nanjing Bank with annual interest rate of 3.1% and due on various dates from July to September 2014, and collateralized by approximately $3.16 million of accounts receivable from wholesale customers. At June 30, 2014, approximately $5.82 million was unused and available under this line of credit.  Approximately $0.68 million was repaid subsequent to June 30, 2014.

On April 10, 2013, 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 Mr. Kang. As of June 30, 2014, LA GO GO had borrowed $2.44 million (RMB15 million) under this line of credit with an annual interest rate of 6.16% and due on various dates from July to October 2014. At June 30, 2014, approximately $0.81 million (RMB5 million) was unused and available under this line of credit. Approximately $0.81 million was repaid subsequent to June 30, 2014.

On January 29, 2014, Ever-Glory Apparel entered into a line of credit agreement for approximately $8.44 million (RMB52 million) with the Bank of Communications and 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. As of June 30, 2014, Ever-Glory Apparel had borrowed $4.06 million (RMB25 million) with an annual interest rate of 6.9% and due on various dates from February to March 2015. Ever-Glory Apparel had also borrowed $1.87 million from the Bank of Communications with an annual interest rates ranging from 3.82% to 5.75% and due in February 2015, and collateralized by approximately $2.51 million of accounts receivable from wholesale customers. At June 30, 2014, approximately $2.51 million was unused and available under this line of credit.

On July 16, 2013, LA GO GO entered into a line of credit agreement for approximately $3.57 million (RMB22 million) with the Bank of Communications and guaranteed by Jiangsu Ever-Glory and Mr. Kang. As of June 30, 2014, LA GO GO had borrowed $3.25 million (RMB20 million) from the Bank of Communications with an annual interest rate of 6.3% and due in June 2015. At June 30, 2014, approximately $0.32 million was unused and available under this line of credit.

On September 1, 2013, Ever-Glory Apparel entered into a line of credit agreement for approximately $11.37 million (RMB70 million) with Everbright Bank, and collateralized by assets of Jiangsu Ever-Glory, This loan is also guaranteed by Goldenway and Mr. Kang. As of June 30, 2014, Ever-Glory Apparel had borrowed $3.25 million (RMB20.0 million) from Everbright Bank, with an annual interest rate of 6.3% and due in October 2014. Ever-Glory Apparel had also borrowed $2.98 million from Everbright Bank with annual interest rate of 2.98% and due in August 2014, and collateralized by approximately $3.98 million of accounts receivable from wholesale customers. At June 30, 2014, approximately $5.14 million was unused and available under this line of credit. Approximately $3.98 million was repaid subsequent to June 30, 2014.

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 June 30, 2014, Ever-Glory Apparel had borrowed $5.55 million from HSBC with an annual interest rates ranging from 2.78% to 5.88%, due on various dates from July to September 2014, and collateralized by approximately $7.9 million of accounts receivable from wholesale customers. These bank loans are to be repaid upon receipt of payments from customers. As of June 30, 2014, approximately $1.45 million was unused and available.

On November 11, 2013, Ever-Glory Apparel entered into a line of credit agreement for approximately $5.68 million (RMB35 million) with the Bank of China and guaranteed by Jiangsu Ever-Glory and Mr. Kang. As of June 30, 2014, Ever-Glory Apparel had borrowed $1.62 million (RMB10 million) with an annual interest rate of 6.05% and due in October 2014 under this line of credit. Ever-Glory Apparel had also borrowed $3.49 million ($1.6 million and RMB 11.6 million) from the Bank of China with annual interest rates ranging from 3.62% to 3.9% and due on various dates from July to August 2014, and collateralized by approximately $4.99 million of accounts receivable from wholesale customers. Approximately $1.60 million was repaid subsequent to June 30, 2014.  As of June 30, 2014, approximately $0.57 million was unused and available.

As of June 30, 2014, 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 June 30, 2014, Ever-Glory Apparel had borrowed $2.68 million from Ping An Bank, with annual interest rate of 3.9% and due on various dates from July to September 2014, and collateralized by approximately $3.83 million of accounts receivable from wholesale customers. Approximately $1.0 million was repaid subsequent to June 30, 2014.

Total interest expense on bank loans amounted to $774,693, $1,481,808, $736,695, and $1,528,224 for the three and six months ended June 30, 2014 and 2013, respectively.