Healthcare Finance in Underdeveloped Regions

A senior secured loan of CNY492.195 million ($75 million) with 5 years tenor was provided to State Grid International Leasing (SGIL, formerly Yingda International Leasing) in the PRC. The proceeds were used to finance hospital facilities in counties or lower tier cities (i.e., excluding provincial capital cities) in the central and western regions of the PRC. This include direct lease of modern medical equipment as well as hospital fixed assets investments through sale and lease back transactions. According to the latest WHO data, the total health care expenditure accounted for 5.4% of the GDP in the PRC in 2012, significant lower than the global average of 9.2%. The healthcare investments are lower in the less developed central and western regions, leading to poorer facilities. There are 2.96 and 3.10 hospital beds per thousand populations in the central region and western region respectively, while the ratio was 3.17 in the eastern region. In the central and western regions, the average assets per hospital were CNY79.9 million and CNY68.9 million, respectively, significantly lower than the average of CNY122.6 million in the eastern region.