EMBATTLED City Harvest Church has
borrowed $45 million against its stake in Suntec Singapore International
Convention and Exhibition Centre to clear a previous loan it could not pay.
If the church - which has six leaders embroiled in an ongoing
high-profile court case - defaults on the steep repayments, it could lose its
entire 39 per cent slice of the prime property.
The six-year loan has not come cheap, according to details filed
with the Singapore Exchange (SGX) by one of the lenders.
The church is paying 8 per cent annual interest on the $45
million, plus $2.6 million a year for five years in what is described as a
front-end fee - a fee levied on a borrower in a commercial loan and usually
paid at the start of it.
The interest plus fee works out to an average rate of around 13
per cent annually for the six years of the loan - well above home loan rates of
less than 2 per cent.
In dollar terms, it has to pay an average of $5.77 million in
interest and other charges every year.
At the end of six years, it will still need to pay back the
principle of $45 million. City Harvest can repay the loan earlier if it wishes
and save on some interest costs.