Export Finance and Insurance Corporation (EFIC), the Australian Government’s export credit agency, performed strongly last financial year despite ongoing volatility in financial markets.
In 2010-11, EFIC provided more than 100 facilities worth $593.1 million supporting exports and overseas investments valued at over $3.4 billion to more than 40 countries.
EFIC’s 2010-2011 Annual Report, tabled in Parliament earlier this year, reports EFIC’s profit on its Commercial Account as $30.2 million, reflecting the continuing strength of the underwriting of new transactions and the repayment of existing facilities.
The strong results came in a year of significant volatility, higher appetite for debt to finance large-scale resource projects and related infrastructure, as well as an increased demand for SME products against an uneven recovery in the global economy and commercial credit markets, and a high Australian dollar.
Demand for bonding lines from companies involved in international construction and infrastructure projects saw EFIC deliver over 45 per cent of its signings in dollar value to the construction industry. This was followed by ship building and repair services at just under 18 per cent.
EFIC’s SME team had another year of strong growth, responding to the continuing challenges that Australian SME exporters face in financing their export opportunities.
There were 90 facilities signed with SMEs worth $136.7 million across a wide range of products and sectors.
EFIC CEO and Managing Director Angus Armour said that with volatile world financial markets and bank funding issues in Europe, demand for finance from both the large corporate and SME sectors is strong.
“We are continuing to adapt our products and approaches in this environment to help Australian firms win new export contracts and protect their offshore investments. Notably, EFIC also is increasingly being asked to deliver cornerstone components of
financing for large projects.”
Mr Armour also commented that EFIC’s results reflected the credit quality of EFIC’s portfolio, which remained strong despite uncertainty around the global economy.
On the year ahead, Mr Armour predicts that EFIC and its services will continue to make a difference to Australian companies facing financing barriers when doing business overseas.
“Markets remain uncertain and credit conditions overseas will remain tight in the year ahead. As a result, we anticipate increased demand for EFIC to support Australian exporters.”
Export Finance and Insurance Corporation (EFIC)
Ph: 1800 887 588