financial support for polish companies: export and expansion · 204/204/204 218/32/56 118/126/132...
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Financial Support for Polish Companies: Export and Expansion
Warsaw, 2017
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BGK’s strategic role is to organise a financial support system for Polish companies
based, among others, on Government Programme Financial Support for Exporters.
Funds provided by BGK might be used, among others, on:
execution of short-/long-term export contracts,
foreign projects execution,
acquisitions of foreign companies and / or foreign assets.
Polish International Development Fund (FEZ) co-finances international expansion projects of Polish companies, on commercial terms.
FEZ shares project risks with Polish companies investing equity and non-recourse
loans directly into their foreign subsidiaries.
More information on pages 13-14
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Financial support For whom? Products Our Clients’ transactions
Financial Support for Polish Companies: Export and expansion BGK and PFR TFI support
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Support for Polish companies on high-risk markets, disregarded by most commercial banks (including Africa, Russia, Belarus, Kazakhstan, the Balkans and many others).
Experience in financing projects, among others, in: Canada, India, China, Russia.
Tailored-made financial structures (tenor, security package) for specific needs and purposes.
Attractive pricing reflecting the actual cost of capital and undertaken risk.
The variety of financing structures.
Possible financing in USD, EUR, GBP, CHF, CAD, PLN.
Financial support For whom? Products Our Clients’ transactions
Financial Support for Polish Companies: Export and expansion BGK Group support
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Polish trade/production enterprises seeking for:
increase of transaction`s security by accepting the risk of insolvency of the counterparty,
improvement of liquidity as a result of receiving payment at sight for the sold goods,
financial support for foreign buyers (both commercial and public),
financing of investments in which a Polish company acts as the general contractor or a main subcontractor,
support for foreign expansion projects (M&As, construction of production plants / distribution centres).
Financial support For whom? Products Our Clients’ transactions
Financial support for exports/ foreign expansion Product range
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Buyer’s bank credit
Buyer’s credit
Credit for financing foreign expansion
L/C postfinancing
L/C discounting
L/C confirmation
Purchase of export receivables
Polish International Development Fund
Guarantees
Range of products
Financial support For whom? Products Our Clients’ transactions
Financial support for exports/ foreign expansion Offered products
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Financing based on documentary letter of credit Basic parameters
Letter of credit
Main characteristics Financing of consumption and investment exports, mitigates transaction risk, ensures liquidity.
Type Financing based on financial standing of Importer’s bank, Financing based on documentary letter of credit.
Maximum repayment period
2 years
Avilable structures discounting confirming postfinancing
Countries Majority of countries
Currency PLN EUR USD
Financial support For whom? Products Our Clients’ transactions
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Financing based on letter of credit Costs of financing
rate for buyer = rate for buyer’s bank + buyer’s bank margin
Costs of L/C are usually born by both sides.
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Example Tenor of financing: 360 days
Azerbaijan, Russia, Tunisia,
Belarus, Georgia, Ukraine, Kazakhstan,
Kenya, Nigeria
Annual cost of credit and insurance (%) (one should add base rate to the presented
cost)
EUR USD EUR USD
1.05 – 1.27 1.45 – 1.69 1.50 - 1.77 1.90 – 2.19
Confirmation commission for each quarter of validity period (%)
0.30 – 0.32 0.35 - 0.37
L/C receivables payment commission (%) 0.20
Financial support For whom? Products Our Clients’ transactions
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Buyer’s bank credit Basic parameters
Buyer’s Bank Credit
Type of credit Financing based on financial standing of Importer’s bank
Minimum repayment period
2 years
Amount of credit Up to 85% of contract value, min. EUR 1 m
Countries Majority of countries
Cost of credit Incurred by Importer
Purpose Financing exports of investment goods and services
Currency PLN EUR USD
Financial support For whom? Products Our Clients’ transactions
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rate for buyer = rate for buyer’s bank + buyer’s bank margin
CIRR rate valid from 15.11.2017 till 14.12.2017
Example Disbursement period: 1 year Repayment period: 5 years
Azerbaijan, Russia, Tunisia
Belarus, Georgia, Ukraine, Kazakhstan,
Kenya, Nigeria
Fixed rate – CIRR (%) – p.a. EUR USD EUR USD
0.39 2.68 0.39 2.68
Administration commission (paid annually) (%) 0.7 0.7
Minimum KUKE insurance premium for five-year period (paid in lump sum) (%)*
3.55 – 8.83 6.72 – 10.46
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Buyer’s bank credit Costs of financing
Financial support For whom? Products Our Clients’ transactions
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Purchase of receivables Basic parameters
Purchase of receivables
Type of credit Financing based on: Importer’s balance sheet – no recourse Exporter’s balance sheet – recourse to the Exporter
Amount of credit Minimum EUR 2 m
Period of financing Up to 5 years
Currency PLN EUR USD
Countries Majority of countries
Pricing conditions Terms determined individually based on transaction risk profile
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Financial support For whom? Products Our Clients’ transactions
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Buyer`s credit Main parameters
Buyer`s credit
Purpose Financing of export contracts between a Polish exporter and importer
Financing structures
1. Project finance 2. Corporate finance based on Importer`s balance sheet 3. Sovereign finance 4. Joint Venture
Credit amount Minimum EUR 10 m (not more than 85% of the export contract value). There is a possibility of financing of the KUKE Premium within the Credit
Tenor Up to 15 years* (including 3 years of availability period)
Currency PLN, EUR, USD, CAD, GBP
Pricing To be agreed individually according to risk profile of the transaction
Security Project assets Insurance of the Polish ECA (KUKE) / other ECA
Financial support For whom? Products Our Clients’ transactions
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*Tenor of financing and repayment profile should be in line with to OECD regulations
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Foreign investments of Polish Companies Main parameters
Financing of a Polish company in order to execute foreign investments / foreign acquisitions
Purpose Financing of expansion of Polish companies abroad (acquisition of companies and/or assets of companies abroad / construction of production plants abroad / financing of JV with a foreign company abroad)
Type of credit Long – term investment loans based on balance sheet of a Polish or a foreign entity
Credit amount Minimum EUR 8-10 m
Tenor To be agreed
Currency
PLN EUR USD CAD GBP
Pricing To be agreed individually according to risk profile of the transaction
Security Foreign assets of a project / a target company (others, if needed)
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Financial support For whom? Products Our Clients’ transactions
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Foreign investments of Polish Companies Polish International Development Fund (FEZ) – basic information
Fund co-invests with Polish companies in their subsidiary companies abroad - the ownership of the Polish company is not diluted.
Risk sharing in the foreign project - no recourse to the Polish Partner.
Exit from the investment after a few years - after the foreign project company has reached satisfactory results.
Nearly all sectors of the economy and nearly all countries worldwide are eligible.
Co-financing for greenfield projects and for further expansion, as well as for acquisitions of existing companies.
Polish Partner can assume full operational control of a foreign company with a part of the payment deferred for several years.
Polish Partner
Foreign Project
Company Profile
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Financial support For whom? Products Our Clients’ transactions
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Financial support For whom? Products Our Clients’ transactions
Foreign investments of Polish Companies Polish International Development Fund (FEZ) – financial instruments
Polish International Development Fund
Purpose Risk-sharing and co-financing of foreign investments with Polish companies
Type of financing Share capital and non-recourse loans to foreign project companies
Financing amount
To be agreed
Maturity To be agreed, typically 5-10 years
Exit Sale of shares to the Polish Partner, conversion into a loan or redemption of shares in the foreign project company
Pricing Price of the shares at market value or price formula pre-agreed with the Polish Partner
Collaboration with the Partner
The Fund is always a minority investor - the management of the foreign project company remains in the hands of the Polish Partner. The Fund supports the Polish Partner on the Board of Directors of the foreign project company
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USD 19 m
Mining equipment
Mexico
EUR 10 m Construction of
production plants
China, India, Mexico
EUR 21.8 m Construction
of production plant
Germany
CAD 150 m
Exploration of hydrocarbons
Canada
PLN 111.3 m
M&A Financing
Great Britain
EUR 48.2 m
Mineral Wax plant
Belarus
EUR 18.7 m
Mining Equipment
Russia
EUR 100 m Construction of
production plants
Brazil, Netherlands
EUR 44 m
Hotel construction
Belarus
EUR 2.2 m
Vacuum furnaces
Ukraine
EUR 8 m
Mining equipment
Kazakhstan
EUR 1.5 m
Construction machines
Serbia
EUR 15.9 m
M&A Financing
France
EUR 7.1 m
M&A Financing
Italy
Financial support For whom? Products Our Clients’ transactions
Financial Support for Polish Companies: Export and Expansion Selected transactions
USD 39 m
Hotel construction
Georgia
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Bank Gospodarstwa Krajowego Al. Jerozolimskie 7, 00-955 Warszawa www.bgk.pl
Trade Finance Department Tel: +48 22 522 92 75 e-mail: [email protected] Structured Finance Department Export Finance Team Tel: +48 22 522 91 05 e-mail: [email protected]
Polish International Development Fund www.pfrtfi.pl ul. Ludna 2, 00-406 Warszawa Tel: +48 22 341 70 00 e-mail: [email protected]