| BANK LOANS |
NOTE 12 – BANK LOANS Short-term bank loans Short-term bank loans represent the amounts due to various banks that are due within one year. These loans can be renewed with the bank upon maturity. At December 31, 2014 and 2013, short-term bank loans consisted of the following: | | | December 31, 2014 | | | December 31, 2013 | | | Loan from China Development Bank, due on July 22, 2015 with variable annual interest rate based on LIBOR(1) plus 245 basis points (3.137% at December 31, 2014), guaranteed by Xinrong Zhuo, Honghong Zhuo, Zhiyan Lin and Shuhui Ke | | $ | 5,000,000 | | | $ | - | | | Loan from China Development Bank, due on March 9, 2015 with variable annual interest rate based on LIBOR(1) plus 245 basis points (2.777% at December 31, 2014), guaranteed by Xinrong Zhuo, Honghong Zhuo, Zhiyan Lin and Shuhui Ke | | | 3,185,980 | | | | - | | | Loan from China Development Bank, due on November 24, 2015 with variable annual interest rate based on LIBOR(1) plus 245 basis points (2.777% at December 31, 2014), guaranteed by Xinrong Zhuo, Honghong Zhuo, Zhiyan
Lin and Shuhui Ke | | | 9,500,000 | | | | - | | | Loan from China Development Bank, due on December 22, 2015 with variable annual interest rate based on LIBOR(1) plus 245 basis points (2.800% at December 31, 2014), guaranteed by Xinrong Zhuo, Honghong Zhuo, Zhiyan Lin and Shuhui Ke | | | 5,000,000 | | | | - | | | Loan from China Development Bank, due on December 29, 2015 with variable annual interest rate based on LIBOR(1) plus 245 basis points (2.807% at December 31, 2014), guaranteed by Xinrong Zhuo, Honghong Zhuo, Zhiyan Lin and Shuhui Ke | | | 5,000,000 | | | | - | | | Loan from Industrial and Commercial Bank of China, due on January 23, 2015 with annual interest rate of 2.200% at December 31, 2014, guaranteed by Xinrong Zhuo, subsequently repaid on January 23, 2015 | | | 1,640,693 | | | | - | | | Loan from Industrial and Commercial Bank of China, due on February 17, 2015 with annual interest rate of 2.000% at December 31, 2014, guaranteed by Xinrong Zhuo, subsequently repaid on February 17, 2015 | | | 1,027,217 | | | | - | | | Loan from Fujian Haixia Bank, due on March 21, 2014 with annual interest rate of 8.400% at December 31, 2013, guaranteed by Xinrong Zhuo and repaid on due date | | | - | | | | 4,955,647 | | | Loan from Fujian Haixia Bank, due on May 8, 2014 with annual interest rate of 9.000% at December 31, 2013, guaranteed by Xinrong Zhuo and repaid on due date | | | - | | | | 1,651,883 | | | Loan from Fujian Haixia Bank, due on April 22, 2014 with annual interest rate of 9.000% at December 31, 2013, guaranteed by Xinrong Zhuo and repaid on due date | | | - | | | | 2,477,823 | | | | | $ | 30,353,890 | | | $ | 9,085,353 | |
| (1) | It refers to six-month LIBOR rate on the loan commencement date. |
Long-term bank loans Long-term bank loan represents an amount due to a bank lasting over one year. Usually, the long-term bank loan cannot be renewed with the bank upon maturity. At December 31, 2014 and 2013, long-term bank loans consisted of the following: | | | December 31, 2014 | | | December 31, 2013 | | | Loan from China Minsheng Bank, due on various dates until March 16, 2015 with annual interest rate of 7.741% at December 31, 2014 and 2013, collateralized by Pingtan Fishing's and Hong Long's fishing vessels and guaranteed by Xinrong Zhuo | | $ | 3,005,620 | | | $ | 9,143,169 | | | Loan from China Minsheng Bank, due on various dates until March 16, 2015 with annual interest rate of 7.741% at December 31, 2014 and 2013, collateralized by Pingtan Fishing's and Hong Long's fishing vessels and guaranteed by Xinrong Zhuo | | | 733,078 | | | | 2,230,041 | | | Loan from China Minsheng Bank, due on various dates until March 16, 2015 with annual interest rate of 7.741% at December 31, 2014 and 2013, collateralized by Pingtan Fishing's and Hong Long's fishing vessels and guaranteed by Xinrong Zhuo | | | 1,136,271 | | | | 3,456,564 | | | Loan from Fujian Haixia Bank, due on various dates until March 22, 2015 with annual interest rate of 8.400% at December 31, 2014 and 2013, guaranteed by Xinrong Zhuo | | | 1,629,062 | | | | 3,303,764 | | | Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 6.400% at December 31, 2014 and 2013, collateralized by Hong Long's investment in equity interest of a China local bank | | | 16,029,975 | | | | 19,640,881 | | | Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 6.400% at December 31, 2014 and 2013, collateralized by Hong Long's investment in equity interest of a China local bank | | | 586,462 | | | | 718,569 | | | Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 6.400% at December 31, 2014 and 2013, collateralized by Fujian International Trading and Transportation Co., Ltd.'s investment in equity interest of a China local bank | | | 3,078,928 | | | | 3,782,810 | | | Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 6.400% at December 31, 2014 and 2013, guaranteed by Hong Long | | | 12,413,456 | | | | 15,858,070 | | | Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 6.400% at December 31, 2014 and 2013, collateralized by Fujian International Trading and Transportation Co., Ltd.'s investment in equity interest of a China local bank | | | 374,684 | | | | 462,527 | | | Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 6.400% at December 31, 2014 and 2013, collateralized by Hong Long's investment in equity interest of a China local bank | | | 1,026,309 | | | | 1,255,431 | | | Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 6.400% at December 31, 2014 and 2013, collateralized by Hong Long's investment in equity interest of a China local bank | | | 2,622,791 | | | | 2,659,531 | | | Loan from The Export-Import Bank of China, due on various dates until December 10, 2017 with annual interest rate of 6.400% at December 31, 2014 and 2013, collateralized by Pingtan Fishing's investment in equity interest of a China local bank | | | 1,906,003 | | | | 2,329,153 | | | Loan from China Development Bank, due on various dates until November 27, 2023 with annual interest rate of 6.8775% at December 31, 2014 and 2013, guaranteed by Xinrong Zhuo, Honghong Zhuo, Mr. and Mrs. Zhiyan Lin and 14 fishing vessels under construction | | | 12,951,048 | | | | 9,911,294 | | | Total long-term bank loans | | $ | 57,493,687 | | | $ | 74,751,804 | | | Less: current portion | | | (18,868,616 | ) | | | (20,252,077 | ) | | Long-term bank loans, non-current portion | | $ | 38,625,071 | | | $ | 54,499,727 | |
The future maturities of long-term bank loans are as follows: | Due in years ending December 31, | | Principal | | | 2015 | | $ | 18,868,616 | | | 2016 | | | 14,058,809 | | | 2017 | | | 15,362,059 | | | 2018 | | | 1,466,156 | | | 2019 | | | 1,547,609 | | | Thereafter | | | 6,190,438 | | | | | $ | 57,493,687 | | | Less: current portion | | | (18,868,616 | ) | | Long-term liability | | $ | 38,625,071 | |
The weighted average interest rate for short-term bank loans was approximately 3.6%, 8.7% and 4.8% for the years ended December 31, 2014, 2013 and 2012, respectively. The weighted average interest rate for long-term bank loans was approximately 6.8%, 6.8% and 7.9% for the years ended December 31, 2014, 2013 and 2012, respectively. For the years ended December 31, 2014, 2013 and 2012, interest expense related to bank loans amounted to $5,652,572, $4,396,285 and $3,421,660, respectively, of which, $836,902, $1,094,589 and $545,407 was capitalized to construction-in-progress, respectively. |