ECA-covered finance
Talk to us for details concerning the conditions of other ECAs.
Talk to us for details concerning the conditions of other ECAs.
BJN leverages its comprehensive expertise to offer participations in ECA-backed financing to international banks or corporations. Generally, the financing is structured by the contributing bank and BJN as an open syndicate, where funding is distributed between the two. In some cases, BJN may provide the financial solution in full, relieving the contributing bank of all credit risk and funding costs. The availability of buyer credit depends on obtaining coverage from a governmental export credit agency (ECA), with Euler Hermes acting as the guarantor for German exports.
Within the scope of ECA-covered financing, BJN provides a range of financing solutions, each designed to meet specific needs:
The fundamental prerequisite for financing is an export contract signed by the exporter and importer, which may also encompass services. Additionally, they must concur on financing a portion of the contract's value.
Ideally, the exporter's bank should approach BJN during the bid phase to solicit an export finance proposal. Should the deal satisfy the criteria for ECA-covered finance, BJN will issue a provisional indicative finance offer, often expanding the contributing bank's capacity.
Learn more about our joint activities with banks here.
Conditions for ECA-covered finance include:
Once the export contract has been signed and the borrower mandates BJN to provide the financing, BJN prepares the loan documentation and contacts the borrower directly. The importer’s bank or the importer itself may act as the borrower.
BJN has numerous basic agreements with foreign banks. Under these basic agreements, BJN can quickly provide individual loans on a standardised basis for the relevant banks as the borrowers. If the importer itself acts as the borrower, the loan contract is signed directly with the importer.
A precondition for ECA-covered finance is the grant of cover by an export credit agency (ECA). For example, in Germany, Euler Hermes is the responsible ECA. The application for cover is submitted jointly by BJN and the exporter.
The cover provisions in Europe vary according to ECA but are always based on the Guidelines for Officially Supported Export Credits adopted by the OECD member states, known as the "OECD consensus".
The rules and conditions of the relevant ECA must be satisfied. Euler Hermes as the German ECA publishes its conditions on its website at www.agaportal.de.