Business risks

In recent years, Finnvera has increased its risk-taking both in the financing of companies’ domestic operations and in the financing of export trade. Risk-taking is controlled. When companies face challenges, Finnvera cooperates closely with them and with other financiers so that the challenges can be met and profitable business can be resumed.

Finland

Outstanding commitments in domestic financing totalled nearly EUR 3.2 billion at year’s end. Counter-cyclical financing has increased Finnvera’s out-standing commitments and risk level. Approximately 70 per cent of domestic financing is without securing collateral, which means that the collateral lodged does not cover the full amount of the credit or guarantee. Finnvera’s credit losses have represented 2–3 per cent of the outstanding commitments, i.e. they are about three times higher than the corresponding figures for banks.

Abroad

Outstanding commitments in export financing stood at EUR 8.6 billion at the end of 2010. At year’s end, a significant portion of the current guarantees and binding offers were in the country risk categories 0, 3 and 4.  Two factors increase the portfolio’s risk level: on the one hand, demand for financing focuses on large individual projects, on the other hand, the banks involved in the projects are  located in countries with relatively high risks.

Annual Report 2011

Country risk classification and map