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STRUCTURED FINANCE – EXPORT FINANCE. Presentation for xxxxxxxxx Date. Agenda. Page. Facts & Figures about BayernLB3 Export Finance at BayernLB 6 Export Finance Transactions 14 Typical Types of Financing21 5. References and Awards29. Facts & Figures about BayernLB. - PowerPoint PPT PresentationTRANSCRIPT
Presentation for
xxxxxxxxx
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STRUCTURED FINANCE – EXPORT FINANCE
STRUCTURED FINANCE - EXPORT FINANCE Page 2
Agenda
1. Facts & Figures about BayernLB3
2. Export Finance at BayernLB 6
3. Export Finance Transactions 14
4. Typical Types of Financing21
5. References and Awards29
Page
STRUCTURED FINANCE - EXPORT FINANCE Page 3
Facts & Figures about BayernLB
STRUCTURED FINANCE - EXPORT FINANCE Page 4
Group Corporate Structure of BayernLB
Association of Bavarian Savings
Banks
Bayerische LandesbankLegal corporation incorporated under public law
Free State of Bavaria
AAA/Aaa¹
BayernLB Holding AG
5.97% 94.03%
100%
100%89.9% 100%
100% state guarantee
¹
¹ Standard & Poor‘s, Moody‘s
100%100%
STRUCTURED FINANCE - EXPORT FINANCE Page 5
Highlights 2010 – key messages
3
4
5
6
7
Investors benefit from good operating earnings
Deleveraging: Substantial reduction of risks, costs and total assets
Well capitalized – even under the new Basel III regime
Well balanced funding potential and moderate needs
2 All earnings before taxes came from core activities
1 Solid earnings before taxes of EUR 885m in 2010
BayernLB is one of the leading corporate financiers with good loan quality
BayernLB is on track with its customer oriented business model
STRUCTURED FINANCE - EXPORT FINANCE Page 6
Export Finance at BayernLB
STRUCTURED FINANCE - EXPORT FINANCE Page 7
Part of Structured Finance
Board: Jan-Christian Dreesen
Structured Finance
Alexander von Dobschütz
InfrastructureMichel Rousseau
EnergyAndy Brown
Dr. Paul Kunkel
Beate Mayer
CIS / CEE / SEE / BalticsElke Wurth-Weis
New York BranchJames King
Project Finance Export FinanceLeasing, Factoring,
Rolling Stock
EMEA, Americas, AsiaRalf Engelberg
STRUCTURED FINANCE - EXPORT FINANCE Page 8
Export Finance Department
Beate Mayer (Head of Department)
Tel.: +49 (89) 2171-23772
E-Mail: [email protected]
Volker Kuntz (Senior Specialist)
Tel.: +49 (89) 2171-23965
E-Mail: [email protected]
STRUCTURED FINANCE - EXPORT FINANCE Page 9
The Team
Herta Albert
Tel.: +49 (89) 2171-23802
E-Mail: [email protected]
Hans Grutza
Tel.: +49 (89) 2171-23514
E-Mail: [email protected]
Doris Wimmer
Tel.: +49 (89) 2171-23977
E-Mail: [email protected]
Andreas Lettow
Tel.: +49 (89) 2171-23647
E-Mail: [email protected]
Evan Sirowinski
Tel.: +49 (89) 2171-23998
E-Mail: [email protected]
Elke Wurth-Weis
Tel.: +49 (89) 2171-23774
E-Mail: [email protected]
The TeamThe Team Section „CIS / CEE / SEE / Baltics“
Richard Lawrynowicz
Tel.: +49 89 2171-23513
E-Mail: [email protected]
Harm Clasen
Tel.: +49 89 2171-26388
E-Mail: [email protected]
Export Finance
STRUCTURED FINANCE - EXPORT FINANCE Page 10
What are our Strengths?
People
• Export & Trade Finance experience for more than 30 years
• Supporting growth of our customers in their markets in the long run
• Structuring capabilities
• Large underwriting capabilities
• Placing / syndication power
• Tailor-made solutions and services
• Know how in specific regions (Europe, CIS, Asia, N&M East, Americas)
• Expertise in specific sectors (Utilities, Metals, Oil/Gas, Telecom, M&E, Aviation)
• Dedicated staff in key markets
Competence
Long-termrelationship
STRUCTURED FINANCE - EXPORT FINANCE Page 11
What are our Products?
Trade Finance
• Multi-source financing of up to 100% of project value• long tenors (often > 10 years)• Lending on basis of corporate risk• Credit enhancement by ECA and/or PRI and/or off-take structures
Structured
Export Finance
• Documentary business• Short term trade finance (e.g. advances, post-shipment finance)• Forfaiting
• Hedging instruments for FX, interest and commodities• Emission Certificates (Joint Implementation Certificates,
Clean Development Mechanism)• Emission trading• Consulting and advisory services
Cross-sellingproducts
STRUCTURED FINANCE - EXPORT FINANCE Page 12
Who are our Partners?
Trade Finance
• Exporters
• Importers
• Export Credit Agencies (ECAs)
• Private Risk Insurance Companies
• Commercial Banks
• Multinational Finance Institutions (MFIs)
• Exporters
• Trading Companies
• Commercial Banks
• Off-takers
• Private Insurance Companies
StructuredExport Finance
STRUCTURED FINANCE - EXPORT FINANCE Page 13
Our Main Partner Banks in Russia
Advantages:
• Efficient Work Flow
• Close Cooperation
• International Documentation Standards
• Track Record
Existing Basic Agreements for ECA covered Buyer‘s Credits
STRUCTURED FINANCE - EXPORT FINANCE Page 14
Export Finance Transactions
STRUCTURED FINANCE - EXPORT FINANCE Page 15
Risks and Time Flow
AcquisitionAcquisition Purchase / Production
Purchase / Production Delivery/iesDelivery/ies
Term of PaymentTerm of Payment
t0 tnt1 t2
Supplier‘s Credit
Buyer‘s CreditDisbursement Period Repayment Period
Forfaiting
Assembly / Acceptance
Assembly / Acceptance WarrantyWarranty
Conclusion of Contract
Average Delivery Date
Readiness for Operation
Political Risk: war / riot / confiscation ban on imports / embargo risk of conversion and transfer of currency interdiction of payment / moratorium
Commercial Risk: insolvency non-payment („protracted
default“)
STRUCTURED FINANCE - EXPORT FINANCE Page 16
Good operating business – BayernLB „back on track“
Payment Conditions in Export Contracts
• currency (EUR / USD / CHF)
• handling of payments / payment instrument (e.g. L/C)
• payment conditions according to OECD consensus
• place of payment
• type of payment collateral (e.g. guarantees)
• allocation of costs for handling of payments
• allocation of costs for payment collateral
• allocation of costs for financing
• payment of the ECA premium
STRUCTURED FINANCE - EXPORT FINANCE Page 17
Governmental Support for Exports:OECD Consensus
„Gentlemen‘s Agreement“ of the OECD countries about rules of governmental support of exports
Target: avoid distortion of competition
Valid for all state-aided export finance transactions with a credit period of more than 2 years
• (National) Export Credit Insurance (ECA)
• Direct credits or refinancing schemes
• Subsidies for interest payments
• Insurance against unlawful claim of guarantee
Instruments
STRUCTURED FINANCE - EXPORT FINANCE Page 18
OECD Consensus (cont’d)
min. 15 % of the contract value Down / Interim payments
85% of the contract value covered by ECA
10 years maximum tenor (for category II countries)
Repayment in equal, semi-annual instalments, the first
to be due 6 months after „Starting Point“
e.g. last essential delivery, mean weighted delivery,
readiness for operation
STRUCTURED FINANCE - EXPORT FINANCE Page 19
Euler Hermes Kreditversicherungs AG, Hamburg
German „Export Credit Agency“ (ECA)
manages the official export credit guarantee scheme on behalf and for account of the Federal Government, such scheme granting coverage of political and
commercial risks resulting from receivables and loans agreed in foreign contracts.
Vital preconditions for granting cover:
• Eligibility of goods (deliveries / services must substantially be of German origin (foreign content max. 30 - 49 %))
• Fungibility of risks / no public budget constraints
• Application for cover needs to be filed before conclusion of contract
• OECD conform payment conditions
STRUCTURED FINANCE - EXPORT FINANCE Page 20
Multi Source / ECA Desk
Multi Source / ECA Desk
Bayern LB is Partner for Public Export Credit Agencies (ECAs)
STRUCTURED FINANCE - EXPORT FINANCE Page 21
Typical Types of Financing
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ECA-covered Buyer’s Credit• Definition: the principal bank of a foreign contractual partner
of the exporter („buyer“) or the buyer is granted a loan whereas the borrowed funds are
disbursed directly to the exporter for payment of the purchase price
• Loan Amount: 85% of the contract value plus100% of the ECA premium pluspart of local costs if eligible for ECA cover
• Additional uncovered financing possibilies: possible financing of the down/interim payments qualified financing of remaining local costs
STRUCTURED FINANCE - EXPORT FINANCE Page 23
ECA-covered Buyer’s Credit (cont’d)
Additional Collateral required by the ECA:
• Exporter‘s undertaking
• Financial statements according to IRFS in case the buyer is acting as borrower
• Guarantees (as the case may be)
• Pledge of assets (as the case may be)
STRUCTURED FINANCE - EXPORT FINANCE Page 24
ExporterExporter Importer (Buyer)Importer (Buyer)
ECA(Export Credit Agency)
ECA(Export Credit Agency)
Domestic Bank
(“Borrower”)
Domestic Bank
(“Borrower”) Buyers Credit
Export Contract
ECA Cover **
15% Cash Down and / or Interim Payment *
Repayment
Disbursement of 85% through L/C pro rata deliveries / services
* potential uncovered financing of down payment / interim payments
** potential ECA premium financing
L/C advisingL/C advising
Opening of L/C
Bayern LBBayern LB
Loan Agreement
Scheme:Buyer‘s Credit (bank)
STRUCTURED FINANCE - EXPORT FINANCE Page 25
ExporterExporter Importer (Buyer)“Borrower”
Importer (Buyer)“Borrower”
ECA(Export Credit Agency)
ECA(Export Credit Agency)
Domestic Bank
Domestic Bank
Loan Agreement / Buyer's Credit (“tied export credit”)
Export Contract
ECA Cover ** Guarantee support
(optional)
15% Cash Down and / or Interim Payment *
Repayment Disbursement
of 85% through L/C pro rata deliveries / services
* potential uncovered financing of down payment / interim payments
** potential ECA premium financing
L/C advisingL/C advising
Opening of L/C
Bayern LBBayern LB
Scheme:Buyer‘s Credit (corporate)
STRUCTURED FINANCE - EXPORT FINANCE Page 26
Supplier’s Credit Forfaiting • Supplier‘s Credit:
The supplier is granting a loan to the foreign buyer by by way of concession of a grace period for payment. This period may be refinanced via forfaiting.
• Forfaiting: Purchase without recourse of abstractly documented receivables, e.g.
receivables from bills of exchange
deferred payment letters of credit
book claims
The bank takes over the commercial and political payment risk
STRUCTURED FINANCE - EXPORT FINANCE Page 27
Forfaiting (cont’d)
Requirements for Forfaitability:
• Additional collateral as might be required by the ECA or the bank
• Export contract has to allow assignment of claims
• Export contract has to foresee yearly presentation of financial statements according to IFRS
• Purchased claims have to be free of objections and/or counterclaims under the export contract
STRUCTURED FINANCE - EXPORT FINANCE Page 28
For
faiti
ng A
gree
men
t
1a. Export Contract
2. Term of Payment
1b. ECA cover
Rem
ittan
ce o
f In
tere
st a
nd
Rep
aym
ent
Am
oun
ts5. Interest and Repayment
À-f
orfa
it P
urch
ase
and
Dis
bur
sem
ent
German ExporterGerman Exporter Buyer / Payment Obligor
Buyer / Payment Obligor
ECA(Export Credit Agency)
ECA(Export Credit Agency)BayernLBBayernLB
3a.
Assignment of Claims from- the Export Contract- the Exporter‘s ECA cover- L/C or Payment Guarantee
4. 6.
3b.
Scheme:Forfaiting
STRUCTURED FINANCE - EXPORT FINANCE Page 29
References and Awards
STRUCTURED FINANCE - EXPORT FINANCE Page 30
Deal Highlights
EUR 115,500,000
Export Finance Facility
OAO Kabbalkgips
Mandated Lead Arranger (Russia)
2010
Mandated Lead Arranger (Turkey)
EUR 149,351,984
Euler Hermes covered Export Finance
Facility
2010
Lead Arranger
EUR 26,205,806Wind Energy
Converters Turkey Export Credit FacilityEuler-Hermes Cover
2010
EUR 1,878,700,000
6 submarines Type 214 Hermes covered
Export Finance Facility
Undersecretariat of Treasury
Mandated Lead Arranger
2010
Mandated Lead Arranger (Russia)
EUR 1,500,000,000
Syndicated Pre Export Finance
2010
Mandated Lead Arranger (Russia)
EUR 325,000,000 for SIF
Revolving Collateralised Loan
Facility
2010
Participating Lender(Hungary)
USD 475,000,000
Issuance of Import LOCs
2010
€ 3,900,000,000
Gas PipelineBaltic Sea RegionMandated Lead
Arranger
2010
STRUCTURED FINANCE - EXPORT FINANCE Page 31
Deal Highlights (cont’d)
EUR 255,000,000
EBRD A/B-Loan Facility
First project under new Sustainable Energy
Action PlanMandated Lead Arranger
(Kazakhstan)
2008
USD 80,500,000
Road InfrastructureExport Finance
FacilityCo-Arranger (Azerbaijan)
Azeryolservis OJSC
2008
Indramayu Power Project
USD 592,224,258
Export Credit FacilitySinosure Cover
Senior Lead Arranger (Indonesia)
2008
Jamshedpur Expansion Project
EUR 264,000,000
Export Credit FacilityEuler-Hermes Cover
Mandated Lead Arranger
(India)
2009
EUR 69,892,500
Wind turbine generators
EulerHermes coveredExport Finance Facility
Lead Arranger(Turkey)
2009
EUR 262,350,000Fantanele Windfarm
347.5 MW
Euler Hermes coveredExport Finance Facility
Tomis Team / M.W. Team
Invest
Agent & MLA
2009
Vyksa Steel Works
EUR 346,920,200
Euler Hermes covered Export Finance Facility
Mandated Lead Arranger (Russia)
2009
EUR 524,000,000
Multi-Source Master Export Finance
FacilityMandated Lead Arranger (Russia)
2009
STRUCTURED FINANCE - EXPORT FINANCE Page 32
Deal Highlights (cont’d)
Participating Lender(Russia)
USD 50,000,000
Refinancing of the Leasing Portfolio
2007
USD 47,500,000
Euler Hermes Covered Export Finance
Facility
Sole Lender (Kazakhstan)
LLP KaR-Tel
2008
Mandated Lead Arranger (Russia)
USD 300,000,000
EBRD A/B-Loan FacilityEnvironmental Loan
2007
EUR 218,000,000
Export Credit Facility
Finnvera-covered
Mandated Lead Arranger (Russia)
2007
CHF 45,000,000
Refinancing of the Leasing Portfolio
Participating Lender (Russia)
2008
EUR 60,000,000
Euler Hermes Covered Export Finance
Facilities
Sole Lender (Russia)
2008
Mandated Lead Arranger (Russia)
EUR 278,800,000
Euler Hermes covered Export Finance
Facility
2008
Arranger (Russia)
EUR 600,000,000
EBRD A/B-Loan FacilityEnergy Efficiency Loan
2008
STRUCTURED FINANCE - EXPORT FINANCE Page 33
Deal Highlights (cont’d)
EUR 300,000,000
Power ProjectExport Finance Facility
„AzerEnerji“ JSC
Mandated Lead Arranger
(Azerbaijan)
2005
USD 307,237,810Commercial Loan
+USD 174,606,198
Export FinanceEuler-Hermes Cover
Participant (Turkey)
2007
EUR 613,000,000
Ermenek Dam and HEPP OeKB covered
Export Finance Facility plus Commercial Loans
Lead Arranger
Undersecretariat of Treasury
2002
EUR 185,000,000 HERMES-covered
EUR 74,500,000 SACE-covered
USD 238,000,000Finnvera-covered
Mandated Lead Arranger (Russia)
2005
STRUCTURED FINANCE - EXPORT FINANCE Page 34
International Awards (since 2009)
Trade Finance Deal of the Year Awards 2009
Russia - NLMK - ECA-backed financing
Russia - Vyksa - ECA-backed financing
Trade & Forfaiting Review - Deal of the Year Awards 2009
Russia - NLMK – ECA-backed financing
STRUCTURED FINANCE - EXPORT FINANCE Page 35
Awards Project Finance since 2009 Category: Deal of the Year
R1 – Europe Infrastructure Deal of the Year
M25 – Europe PPP Deal of the Year
Dolphin –Middle East Oil & Gas Deal of the Year
Shuweihat –Gulf Power Deal of the Year
Nord Stream – Gas Deal of the Year
Centrica/TCW Windfarm Portfolio – Portfolio Deal of the Year
GSM-Rail – Europe Telecoms Deal of the Year
Castor – Europe Oil & Gas Deal of the Year
Barka III & Sohar II – Middle East Power Deal of the Year
GTRBest Deals of
2009