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. Short-term bank loans consisted of the following as of September 30, 2016 and December 31, 2015.

	September 30, 2016		December 31, 2015
Bank	(In thousands of U.S. Dollars)
Industrial and Commercial Bank of China	$	17,688	$	16,940
Nanjing Bank		13,495		13,951
HSBC		7,441		3,129
Bank of Communications		2,998		3,080
China Minsheng Banking		2,998		3,080
Bank of China		2,606		-
China Citic Bank		1,349		-
China Everbright Bank		1,257		3,121
Pin An Bank		-		1,540
	$	49,832	$	44,841

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 $9.0 million (RMB60.0 million). These loans are collateralized by the Company’s property and equipment. As of September 30, 2016, Goldenway had borrowed $6.0 million (RMB40.0 million) under this line of credit with annual interest rates ranging from 4.4% - 4.5% and due on various dates from November to December 2016. As of September 30, 2016, approximately $3.0 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 $18.0 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 Ever-Glory Apparel, Nanjing Knitting and the bank. As of September 30, 2016, Ever-Glory Apparel had borrowed $11.7 million (RMB 78.0 million) under this line of credit with annual interest rates ranging from 4.4% to 4.6% and due on various dates from October 2016 to September 2017. As of September 30, 2016, approximately $6.3 million was unused and available under this line of credit.

In June 2016, Goldenway entered into a line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $7.5 million (RMB50.0 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 September 30, 2016, Goldenway had borrowed $7.5 million (RMB50.0 million) under this line of credit with annual interest rates ranging from 3.3% to 3.8% and due on various dates from January to March 2017.

In June 2016, Ever-Glory Apparel entered into a line of credit agreement for approximately $9.0 million (RMB60.0 million) with Nanjing Bank and guaranteed by Jiangsu Ever-Glory, Mr. Kang and Goldenway. As of September 30, 2016, Ever-Glory Apparel had borrowed $3.8 million from Nanjing Bank with an annual interest rates ranging from 3.7% to 4.0% and due on various dates from October to November 2016, and collateralized by approximately $4.5 million of accounts receivable from our wholesale customers. As of September 30, 2016, approximately $5.2 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 $3.0 million (RMB20.0 million). The line of credit is guaranteed by Mr. Kang and Goldenway. As of September 30, 2016, LA GO GO had borrowed $2.2 million (RMB15.0 million) under this line of credit with an annual interest rate of 5.0% and due in January 2017. As of September 30, 2016, approximately $0.8 million (RMB5.0 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 September 30, 2016, Ever-Glory Apparel had borrowed $7.4 million from HSBC with an annual interest rates ranging from 1.1% to 3.3% and due in October 2016, and collateralized by approximately $8.3 million of accounts receivable from our wholesale customers. These bank loans are to be repaid upon receipt of payments from customers. As of September 30, 2016, approximately $5.2 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 $5.0 million (RMB33.0 million) with the Bank of Communications and guaranteed by Jiangsu Ever-Glory, Ever-Glory Apparel and Mr. Kang. As of September 30, 2016, LA GO GO had borrowed $3.0 million (RMB20.0 million) from the Bank of Communications with annual interest rates ranging from 4.6% to 5.0% and due on various dates from November 2016 to August 2017. As of September 30, 2016, 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 $3.0 million (RMB20.0 million) with China Minsheng Banking and guaranteed by Ever-Glory Apparel and Mr. Kang. As of September 30, 2016, LA GO GO had borrowed $3.0 million (RMB20.0 million) from China Minsheng Banking with an annual interest rate of 4.6% and due in December 2016.

In March 2016, Ever-Glory Apparel entered into a line of credit agreement for approximately $3.8 million (RMB25.0 million) with Bank of China and guaranteed by Jiangsu Ever-Glory. These loans are also collateralized by assets of Jiangsu Ever-Glory’s equity investee, ChuzhouHuarui, under a collateral agreement executed by Ever-Glory Apparel, ChuzhouHuarui and Bank of China. As of September 30, 2016, Ever-Glory Apparel had borrowed $1.5 million (RMB10.0 million) under this line of credit with annual interest rate at 4.8% and due in October 2016, and $1.1 million with an annual interest rate at 2.5% due in November 2016, collateralized by approximately $1.4 million of accounts receivable from our wholesale customers. These bank loans are to be repaid upon receipt of payments from customers. As of September 30, 2016, approximately $1.2 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 $5.4 million (RMB36.0 million) with the China Citic Bank and guaranteed by Jiangsu Ever-Glory, Ever-Glory Apparel and Mr. Kang. As of September 30, 2016, LA GO GO had borrowed $1.3 million (RMB9.0 million) from the Bank of Communications with annual interest rate at 4.6% and due on December 2016. As of September 30, 2016, approximately $4.1 million was unused and available under this line of credit.

In July 2016, Ever-Glory Apparel entered into a line of credit agreement for approximately $6.0 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 September 30, 2016, Ever-Glory Apparel had borrowed $1.3 million under this line of credit with annual interest rate at 2.8% and due on November 2016, and collateralized by approximately $1.5 million of accounts receivable from wholesale customers. As of September 30, 2016, approximately $4.7 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 $0.6 million, $1.5 million, $0.6 million and $2.1 million for the three and nine months ended September 30, 2016 and 2015, respectively.