Bank Loans

12 Months Ended

Dec. 31, 2015

Bank Loans [Abstract]

BANK LOANS

NOTE 7 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. Short term bank loans consisted of the following as of December 31, 2015 and 2014.

	December 31, 2015		December 31, 2014
Bank	(In thousands of  U.S. Dollars)
Industrial and Commercial Bank of China	$	16,940	$	11,375
Nanjing Bank		13,951		17,357
HSBC		3,129		6,767
China Everbright Bank		3,121		-
Bank of Communications		3,080		13,022
China Minsheng Banking		3,080		3,250
Pin An Bank		1,540		3,868
Shanghai Pudong Development Bank		-		3,250
Bank of China		-		1,328
	$	44,841	$	60,217

In January 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 $9.2 million (RMB60.0 million). These loans are collateralized by the Company’s property and equipment. As of December 31, 2015, Goldenway had borrowed $6.1 million (RMB40.0 million) under this line of credit with annual interest rates ranging from 4.5% - 5.5% and due on various dates from February to September 2016. As of December 31, 2015, approximately $3.1 million was unused and available under this line of credit.

In September 2015, Ever-Glory Apparel entered into a line of credit agreement for approximately $18.5 million (RMB120.0 million) with Industrial and Commercial Bank of China and collateralized by assets of Jiangsu Ever-Glory’s equity investee, Nanjing Knitting, under a collateral agreement executed among the Company, Nanjing Knitting and the bank. As of December 31, 2015, Ever-Glory Apparel had borrowed $10.8 million (RMB 70.0 million) under this line of credit with annual interest rates ranging from 4.4% - 4.6% and due on various dates from April to June 2016. As of December 31, 2015, approximately $7.7 million was unused and available under this line of credit.

In June 2014, Goldenway entered into a line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $7.7 million (RMB50.0 million). These loans are guaranteed by Mr. Kang and 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 December 31, 2015, Goldenway had borrowed $4.6 million (RMB30.0 million) under this line of credit with annual interest rates ranging from 4.6% to 6.1% and due on various dates from January to June 2016. As of December 31, 2015, approximately $3.1 million was unused and available under this line of credit.

In July 2015, Ever-Glory Apparel entered into a line of credit agreement for approximately $9.2 million (RMB60.0 million) with Nanjing Bank and guaranteed by Jiangsu Ever-Glory, Mr. Kang and Goldenway. As of December 31, 2015, Ever-Glory Apparel had borrowed $4.6 million (RMB30.0 million) from Nanjing Bank with an annual interest rate of 5.0% and due on various dates from April to May 2016. Ever-Glory Apparel had also borrowed $3.2 million from Nanjing Bank with an annual interest rate of 1.5% and due on various dates from February to March 2016, and collateralized by approximately $3.8 million of accounts receivable from our wholesale customers. As of December 31, 2015, approximately $1.4 million was unused and available under this line of credit.

In October 2015, LA GO GO entered into a revolving line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $3.1 million (RMB20.0 million). The line of credit is guaranteed by Mr. Kang and Goldenway. As of December 31, 2015, LA GO GO had borrowed $1.6 million (RMB10.0 million) under this line of credit with an annual interest rate of 5.9% and due in January 2016. As of December 31, 2015, approximately $1.5 million (RMB10.0 million) was unused and available under this line of credit.

In January 2015, Ever-Glory Apparel and Goldenway 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 $12.6 million with the Nanjing Branch of HSBC (China) Company Limited (“HSBC”). This agreement is guaranteed by the Company and Mr. Kang. As of December 31, 2015, Ever-Glory Apparel had borrowed $3.1 million from HSBC with an annual interest rate of 4.6%, due in March 2016, and collateralized by approximately $3.6 million of accounts receivable from our wholesale customers. These bank loans are to be repaid upon receipt of payments from customers. As of December 31, 2015, approximately $9.4 million was unused and available under this line of credit.

In July 2015, Ever-Glory Apparel entered into a line of credit agreement for approximately $6.2 million (RMB40.0 million) with China Everbright Bank and guaranteed by Goldenway and Mr. Kang. These loans are also collateralized by Jiangsu Ever-Glory’s property. As of December 31, 2015, Ever-Glory Apparel had borrowed $3.1 million under this line of credit with annual interest rates ranging from 4.5% - 4.8% and due on various dates from January to March 2016, and collateralized by approximately $3.9 million of accounts receivable from wholesale customers. As of December 31, 2015, approximately $3.0 million was unused and available under this line of credit.

In June 2014, LA GO GO entered into a line of credit agreement for approximately $5.1 million (RMB33.0 million) with the Bank of Communications and guaranteed by Jiangsu Ever-Glory, Ever-Glory Apparel and Mr. Kang. As of December 31, 2015, LA GO GO had borrowed $3.1 million (RMB20.0 million) from the Bank of Communications with annual interest rates ranging from 5.0% - 5.3% and due on various dates from August to November 2016. As of December 31, 2015, approximately $2.0 million was unused and available under this line of credit.

In December 2015, LA GO GO entered into a line of credit agreement for approximately $3.1 million (RMB20.0 million) with China Minsheng Banking and guaranteed by Ever-Glory Apparel and Mr. Kang. As of December 31, 2015, LA GO GO had borrowed $3.1 million (RMB20.0 million) from China Minsheng Banking with an annual interest rate of 4.6% and due in December 2016.

In July 2015, Ever-Glory Apparel entered into a line of credit agreement for approximately $9.2 million (RMB60.0 million) with Ping An Bank. As of December 31, 2015, Ever-Glory Apparel had borrowed $1.5 million from Ping An Bank, with an annual interest of 5.6% and due in August 2016, and collateralized by approximately $2.1 million of accounts receivable from our wholesale customers. As of December 31, 2015, approximately $7.7 million was unused and available under this line of credit.

In December 2014, LA GO GO entered into a line of credit agreement for approximately $5.5 million (RMB36.0 million) with the China Citic Bank and guaranteed by Jiangsu Ever-Glory, Ever-Glory Apparel and Mr. Kang. As of December 31, 2015, approximately $5.5 million was unused and available under this line of credit.

All loans have been repaid before or at maturity date.

Total interest expense on bank loans amounted to $2.6 million and $3.3 million for the year ended December 31, 2015 and 2014, respectively.

The annual average interest rate of bank loans was 5.00% and 5.76% for the year ended December 31, 2015 and 2014, respectively.