Rebirth in Hong Kong: From Dessert Shop to Industrial Empire

Chapter 182 Super VVIP Service! (Seeking monthly votes, recommendations, and subscriptions!)

At 9:30 a.m. the next day, Chen Bingwen's black Mercedes-Benz pulled up in front of the Citibank Hong Kong Island branch on time.

Instead of going to the Weiye Building as usual, he came directly here with his secretary Ali and Zhao Gang.

Ali had made an appointment with Li De, President of Citibank Asia Pacific Financial Services, a day in advance.

Acquiring Hutchison Whampoa requires astronomical sums of money, which is far from enough to rely on Chen's own cash flow. Bank loans are currently the best solution.

But Chen Bingwen knew very well that HSBC's Sir Michael Sandberg was secretly looking for a "front man" to take over HSBC's shares in Hutchison Whampoa.

At this critical juncture, seeking a loan from a British-backed bank like HSBC could easily lead to a leak, alerting Sir Michael Sandberg and potentially causing HSBC to change its sale plans, adding numerous uncertainties.

To be on the safe side, he targeted American banks for loans.

Financial regulation and bank risk control in this era were far less stringent than in later periods, leaving more room for maneuver.

He planned to first obtain a basic loan from an American bank, and then use that as principal to apply for a higher margin loan amount through stock pledging, leveraging huge sums of money in order to accumulate enough Hutchison Whampoa shares in a short period of time.

Li De greeted Chen Bingwen very warmly at the door.

"Mr. Chan, it's been a long time! Chan's is doing very well lately. The news of their acquisition of Qingzhou Yingni has caused a sensation throughout Hong Kong."

He smiled and made polite remarks while leading Chen Bingwen to the reception area and personally poured him a cup of coffee.

As an important client of Citibank, Li De naturally paid close attention to Chen Bingwen's movements.

They exchanged a few pleasantries and chatted about their recent situations.

Soon, Chen Bingwen got to the point: "President Li De, the reason I'm here is to apply for another loan from your bank for investment in the capital market."

"Oh? How much funding does Mr. Chen need?"

Li De sat up straight and asked seriously.

“Two hundred million Hong Kong dollars,” Chen Bingwen said calmly.

The smile on Li De's face vanished instantly, and his expression turned serious.

"Two hundred million?" he repeated, then said solemnly, "Mr. Chen, if I may be so bold, two hundred million is no small sum."

Your company recently received a syndicated loan of HK$300 million, which is mainly used to acquire Watsons, but your debt ratio has increased significantly.

According to our bank's standardized risk control model, your company's current cash flow and asset situation make it difficult to support such a large amount of new loans.

He paused, then continued, "Moreover, according to the procedure, we must clearly understand the specific purpose of this huge sum of money, and what kind of collateral or pledge Mr. Chen intends to provide."
This is different in nature from our previous collaborations.

His meaning was clear: the previous loan was based on Chenji's overall revenue and assets, and the quota had been fully utilized.

If you want more, you must provide new, substantial collateral or repayment guarantees.

Chen Bingwen smiled but did not answer directly. Instead, he took a folder from the briefcase that Ali handed him and placed it on Li De's desk.

Li De picked up the folder and opened it with some confusion.

Inside were several agreement documents, all in English.

When he saw the contents of the document, his pupils contracted slightly, and his face showed an undisguised look of shock.

"Is this a licensing agreement for the bottle cap patent?"
Do you also have the annual commission expense reports for Coca-Cola and Pepsi?

He quickly scanned the key figures, subconsciously repeating, "Twenty million US dollars a year in commission from bottle cap usage fees?"

Chen Bingwen nodded, confirming, "That's right. This is a legally binding long-term authorization agreement."

Based on the annual sales volume of Coca-Cola and Pepsi's glass bottle products, the licensing fees for the bottle caps amount to at least $2000 million annually.

At this point, Chen Bingwen paused for a moment, then smiled and said, "President Li De can arrange for someone to verify the payment records of these companies at any time."

This licensing fee is stable, sustainable, and costs almost nothing.

I believe it can provide the best possible repayment guarantee for this HK$200 million loan.

Li De took a deep breath. He knew that Chen Bingwen had no reason to lie to him; he had seen the relevant report in the newspaper before.

Moreover, Coca-Cola, Pepsi, Nestlé, and Suntory are all important clients of Citibank, so verifying these agreements would be a very easy task.

"Chen Sheng, what an amazing strategy."

Li De sincerely praised, "A stable cash flow of 20 million US dollars per year is indeed an extremely high-quality repayment guarantee, far exceeding that of ordinary fixed asset mortgages."

Frankly speaking, this authorized revenue alone is more than enough to cover the interest and principal of the HK$200 million loan.

He paused briefly, then changed the subject, his tone carrying the caution typical of a banker: "However, Mr. Chen, please understand my position."

Even with such a huge loan and high-quality collateral, I still need to know the exact purpose of the funds according to Citibank's compliance procedures.

This is not a lack of trust, but a basic requirement for risk control.

To be frank, the scope of "investment in the capital market" is a bit too broad.

Could you be more specific?

Chen Bingwen had anticipated Li De's question, as he had been an investment banking manager in his previous life and frequently dealt with banks.

He knew the bank's risk control process very well.

So, as soon as Li De finished speaking, he smiled and said, "I understand President Li De's caution very well."

The specific purpose of the funds is to acquire a blue-chip stock that I am optimistic about in the open market.

This stock has excellent fundamentals and a reasonable valuation; I believe it has huge long-term appreciation potential.

He paused briefly, observed Li De's expression, and then offered a more reassuring solution: "Moreover, in order to ensure the safety of the funds to the greatest extent and reduce Citibank's concerns, I can even choose not to withdraw the entire loan amount."

"Incomplete extraction?" Li De was taken aback, not quite understanding.

“Yes,” Chen Bingwen explained, “What I mean is that the loan amount of 200 million Hong Kong dollars can be placed in Citibank and a special margin account can be opened.”

He emphasized the words "margin account".

"I hope your bank can provide me with corresponding margin financing services based on this high-quality collateral and this margin deposit."

Chen Bingwen finally revealed his core purpose: "According to the usual practice in the financial industry, using this high-quality cash as collateral to apply for a leverage ratio of three times shouldn't be considered excessive, right?"

Li De understood immediately.

So that's what Chen Bingwen was planning!

He didn't simply need the 200 million loan; he saw the potential in the 200 million loan as a foundation to leverage purchasing power of up to 600 million Hong Kong dollars!

This money doesn't even leave Citibank; it circulates directly within Citibank's system, where it is overseen and subject to risk control by Citibank.

For the bank, this loan was virtually risk-free, and it also allowed them to earn interest and margin trading fees, while securing a huge sum of money and transaction volume from a super-large client. Chen Bingwen, on the other hand, used the future revenue from his bottle cap patent as collateral, almost effortlessly obtaining HK$600 million in funding to launch acquisitions in the capital market.

This was an extremely brilliant move.

It not only met all the bank's risk control requirements, but also maximized the use of financial leverage to achieve its strategic goals.

Li De was inwardly shaken, but he tried his best to keep his face calm.

He quickly weighed the pros and cons.

risk?

The stable cash flow from the bottle cap patent is sufficient to cover loan principal and interest, and the funds are operated under the supervision of Citibank, so the risk is extremely low.

income?

Interest income, margin service fees, huge capital accumulation, and deep engagement with a top-tier client.

This was a deal that couldn't be more perfect.

He took a deep breath, and a smile returned to his face, this time even more enthusiastic than before: "Mr. Chen, your proposal is truly eye-opening."

He shook his head, his voice filled with admiration: "The perfect combination of high-quality collateral, loan amount, and margin financing services not only solves your funding needs but also fully complies with our bank's risk control requirements."

It must be said that this is a win-win, no, a multi-win solution.

"So, what does President Li think about the feasibility?"

Chen Bingwen smiled and pressed on with more questions.

“The feasibility is very high,” Li De answered confidently. “We will use the stable cash flow from the bottle cap patent as collateral to provide a loan of HK$200 million, which will also serve as a margin deposit to provide you with margin financing services of up to three times the amount.”

I believe this framework will be approved by the risk control committee.

He paused, then added, "Of course, the specific details of the agreement, interest rates, liquidation lines, etc., still need to be finalized, and we need to conduct final legal due diligence to confirm the collateral we hold, namely those patent licensing agreements."

However, as long as the agreement is confirmed to be genuine, valid, and free from any defects in rights, there shouldn't be any major issues.

“Of course.” Chen Bingwen nodded. “My company’s legal counsel will fully cooperate with all legal documents.”

I hope the whole process can be as fast as possible.

"Please rest assured," Li De stood up and extended his hand to Chen Bingwen, "Mr. Chen, I will personally oversee this project and open the VIP access channel."

Once due diligence is completed, we will immediately arrange for signing the contract and disbursement of funds.

The funds and quota are expected to be ready within a week at the earliest.

"Okay! Then I'll wait for President Li De's good news."

Chen Bingwen also stood up and shook Li De's hand firmly, saying, "My team will handle the follow-up details."

Seeing that Chen Bingwen was about to leave, Li De quickly called out to him, "Mr. Chen, please wait a moment."

With a fawning smile on his face, Li De took a step closer and said, "Mr. Chen, please forgive my intrusion."

You just mentioned that you want to use this money to acquire blue-chip stocks in the capital market.

I was thinking that such a large-scale mobilization of funds and stock operations must be no easy task.

Especially in the Hong Kong market, where news spreads quickly, large transactions can easily cause stock price fluctuations and attract external attention.

Chen Bingwen nodded calmly, signaling Li De to continue.

"We at Citibank, as a top global financial services institution, do more than just provide funding," Li De's voice carried a hint of pride, "We provide comprehensive financial solutions for top clients like you."

This includes top-tier trade execution services.

He looked at Chen Bingwen and said confidently, "Mr. Chen, if you need, Citibank can immediately dispatch a top-notch team of Wall Street traders from its New York headquarters to serve you exclusively."

They are proficient in various complex trading strategies and are skilled at covertly building positions with large orders. They can help you smooth out trading traces to the greatest extent, avoid attracting unnecessary attention from the market, and complete the position building at the best price.

Most importantly, this team is completely accountable to you personally, reports directly to you, and is bound by the strictest confidentiality agreements.

Their sole task is to execute your trading orders efficiently and discreetly.

All transaction records will only be reflected in your margin account opened with us at Citibank, and will be untraceable to outsiders.

This will save you a lot of time and effort in building a team and establishing systems.

Chen Bingwen's heart stirred.

This is indeed one of the most pressing issues he needs to address right now.

He originally planned to have the company's investment department continue to handle the acquisition of Hutchison Whampoa shares, but Citigroup's existing team was undoubtedly the most efficient and reliable choice.

This is equivalent to Citibank opening up its core resources to this super VVIP client, providing a service that is almost like a "white glove".

This not only demonstrates his importance as a customer, but also shows that he can actually solve his practical problems.

Seeing that Chen Bingwen was thinking, Li De knew that he had hit the nail on the head. He smiled and said, "Mr. Chen, our Citibank service philosophy is to do everything possible to create value for our customers."

Your success is our success.

All the team's costs are already included in your margin trading service rate; you do not need to pay any additional fees.

Look

Chen Bingwen smiled.

You really get what you pay for, but he really liked the feeling of being respected!
“President Li De,” Chen Bingwen said, “we will do as President Li De says.”

Please send this team to Hong Kong as soon as possible. I hope that by the time they arrive, our funding and quotas will also be ready.

Seeing Chen Bingwen accept so readily, Li De was in high spirits, as this meant that the cooperative relationship between the two parties had deepened and become even closer.

He immediately assured him, "Absolutely no problem! Mr. Chen, I will personally coordinate this matter and will definitely select the most experienced and trustworthy top trader to lead the team."

The team is expected to arrive in Hong Kong Island within two or three days and report to you.

Chen Bingwen nodded approvingly, "Then, I will have my secretary Ali and CFO Fang Wenshan directly liaise with your bank and the future transaction team regarding the specific operational details."

“Absolutely! We will assign someone to handle this and ensure everything goes smoothly.”

Li De readily agreed.

After shaking hands and saying goodbye again, Li De escorted Chen Bingwen all the way to the bank gate and watched his Mercedes-Benz drive away before returning to his office with satisfaction and picking up the phone to call New York.

(End of this chapter)