Export Supplier Loan

A special-purpose loan for financing the export of goods and services from the Czech Republic

How may we
assist you?

Quick payment of export
receivables from a loan
to the buyer or its bank

Goods, services, and attractive financing for your customers

We will assist you with analysing and selecting suitable trade partners

We provide guarantees, hedging, and production pre-financing

No strain on your company’s balance sheet

THIS LOAN IS USED FOR

  • Financing complete plant projects, including associated services and commissioning costs

  • Financing pieces of equipment (fixed assets) and machinery, including spare parts

  • Financing the export of ships, aircraft, rail vehicles and energy generating units under special regulations

  • Expanding your international trading capabilities

USEFUL INFORMATION

  • Special-purpose loan from the exporter’s bank to a foreign buyer or borrower (debtor), i.e. either the foreign buyer’s bank or the foreign buyer can be the debtor
  • Quick payment of export receivables from a loan provided to a foreign buyer or its bank
  • Exporter must be a Czech legal entity, exceptionally an individual (either independently or in a consortium with a foreign entity)
  • Loan will not burden your company’s balance sheet – foreign buyer or its bank acts as the debtor
  • If you are taking part in a foreign tendering procedure you can present a loan term sheet together with your technical bid – the bank will prepare a proposal of the financing terms and conditions
  • Facilitate negotiations regarding additional funds for your company - production pre-financing, guarantee instruments, currency risk hedging
  • We will help you to select the right foreign partner by analysing the project parties
  • Loan usually covers up to 85% of the commercial contract value, with 15% of the commercial contract value covered by the foreign buyer in advance
  • Loan intended in particular for financing the export of goods or services originating (at least 50%) in the Czech Republic
  • Loan can only be drawn after the goods or services have been delivered – the money is paid directly to your company’s account in KB
  • Separate loan agreement is always concluded, specifying the terms and conditions such as drawdown and repayment
  • A precondition for providing financing through an export supplier loan is the possibility to have it insured with EGAP, insurance cover “D”:
    • It also helps to finance large-scale contracts for export to higher risk countries
    • It provides default risk protection for the financing bank, i.e. default risk resulting from territorial risks or risks that cannot be reinsured commercially
  • Analysis of the project and debtor must be suitable for the bank and EGAP
  • The export contract and its financing may not be contrary to international rules and sanctions

Export Supplier Loan – loan agreement with the buyer

  1. Commercial contract
  2. Guarantee (security)
  3. Loan agreement
  4. Financing agreement
  5. Credit risk insurance

Before loan utilisation, you enter into the following contracts and agreements:
 

  1. Commercial contract between the exporter and foreign buyer
  2. Security agreement relating to the loan between the foreign buyer and its guarantor
  3. Loan agreement between KB (lender) and the foreign buyer (borrower)
  4. Financing agreement for the transaction between KB and the exporter (exporter commits to fulfil its obligations to KB)
  5. Insurance policy between KB (insured) and EGAP (insurer)

 

General credit facility with the buyer’s bank 

  1. General credit facility
  2. Commercial contract
  3. Internal loan agreement
  4. Loan agreement (individual)
  5. Financing agreement
  6. Credit risk insurance

 

Before loan utilisation, the following contracts and agreements must be concluded in connection with the general credit facility: 

 

  1. In some cases: interbank general credit facility agreed between KB and the buyer’s foreign bank in advance
  2. Commercial contract for delivery between the exporter and the foreign buyer
  3. Internal loan agreement between the foreign buyer and its bank
  4. Individual loan agreement between KB and the buyer’s foreign bank
  5. Financing agreement for the transaction (exporter commits to fulfil its obligations to KB)
  6. Insurance policy between KB and EGAP