KATHMANDU: A Chinese court has given verdict in favor of Himalayan Bank Limited (HBL) and Bank of Kathmandu (BoK) on a case of counter guarantee money filed by these banks against China Construction Bank (CCB), in the Melamchi Drinking Water Project.
With this, the two banks will now get the counter guarantee money worth Rs 1.5 billion that they were fighting for since many years. Officials at BoK informed that they are preparing to claim the money today itself.
HBL had issued $6.665 million as performance guarantee in 2013, while BoK had issued $6.2 million and 1.40 million euros as advance payment guarantee to Melamchi Water Development Board to provide the counter guarantee to CCB, the guarantor for the project contractor, China Railway 15 Bureau Group.
Before appointing the Italian contractor Cooperativa Muratori & Cementisti di Ravenna, the China Railway 15 Bureau Group had been awarded the contract to develop the Melamchi project.
However, the contract was terminated after the Chinese contractor demanded additional funds than mentioned in the bid document to complete the project despite repeatedly missing the project deadline.