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Provide interest-free loan

The Government provides capital assistance in the form of interest-free loan for the construction of school buildings to non-profit-making international school operators allocated with greenfield sites on an application basis.  The loan is capped at 100% of the cost for constructing a standard-design public sector school accommodating the same number of students.  It does not cover the construction of pre-primary school or boarding facilities, if provided.  Subject to the approval of the loan fund application by the Finance Committee of the Legislative Council, a loan agreement will be signed between the Government and the successful applicant.  The loan shall be secured by a legal charge on the property in favour of the Government.  It will be drawn down upon the completion of the school building and is repayable in ten years. 

The Finance Committee of the Legislative Council has approved a number of the loan applications of international schools for the construction of the school premises on greenfield sites.  Recent approvals include loans to the Kellett School Association Limited (HK$203.83 million, 2012), the Hong Kong Academy Educational Foundation Limited (HK$157.72 million, 2012) and Harrow International School (Hong Kong) Limited (HK$272.74 million, 2012).

The applicants, being non-profit-making organisations, can only obtain bridging-loan for the construction of school building from private or commercial sources with the backing of Government’s interest-free loan.  The loan, if approved, will contribute towards repayment of the bridging loans which the applicants have taken out to finance the construction of the new school premises.

Those allocated a greenfield site and wish to apply for the interest-free loan should provide the following in making an application to the Education Bureau:

  1. The exact number of primary and/or secondary students to be accommodated on the campus at the greenfield site;
  2. A substantiated building plan;
  3. The projected profit and loss account, cash flow statements and balance sheet for the entire period of the proposed loan, and the underlying basis and methodology used in arriving at the assumptions;
  4. List of existing or proposed directors and major shareholders, if applicable; and
  5. Audited accounts of the school operator for the past three years, if available.
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