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31.05.2016
The new financing model proves to be an immediate hit

During its first year, Finnvera’s Start Guarantee attracted applications for 1,600 financing projects. An entrepreneur considers the guarantee convenient for start-ups.Both banks and entrepreneurs have found Finnvera’s Start Guarantee, which has been in use for a little over a year.According to Team Leader Leena Waarna, banks have submitted applications for Start Guarantees to Finnvera for 1,600 financing projects.The bank applies for the Start Guarantee on behalf of the entrepreneur. In other words, the entrepreneur only deals directly with his own bank. Finnvera’s guarantee coverage can be at most 80 %. However, the total sum of Start Guarantees granted to one enterprise may not exceed EUR 80,000.“The Start Guarantee is also well suited for smaller projects, for instance from 30,000 to 50,000 euros in size. Therefore, entrepreneurs should not be discouraged even if they don’t have proper collateral for the bank,” Waarna says.She encourages starting entrepreneurs to contact local advisory services first. They have information, for instance, on competition in both the region and the sector involved.Companies’ initial costs and financing needs vary widely.A few tens of thousand euros is enough for the initial working capital for example in the service sector, whereas considerably more money is needed for investments in projects involving production.“Entrepreneurs are generally pretty good at calculating their expenses in advance. In contrast, turnover forecasts are easily over-optimistic. It is expected that turnover will start to accumulate quickly, and payment schedules are drawn up accordingly,” Waarna says.“Realistic overall calculations and correctly dimensioned credit with its repayment periods help the fledgling entrepreneur to avoid the worst pitfalls,” she continues.A faster startTuure Parkkinen, an entrepreneur from Helsinki, praises the Start Guarantee lavishly.“The Start Guarantee was unusually easy because the bank filed the application for us. From the entrepreneur’s perspective, there was little red tape. In the end, we decided to withdraw 25,000 euros,” Parkkinen reminisces.Together with his partners, he founded ResQ Club late last November. Using the digital service developed by the enterprise, consumers receive information on food that is about to go to waste in restaurants, bakeries, cafés and hotels.The service gives consumers the opportunity to buy food at discounts exceeding even 50 per cent. Restaurants, in turn, can reduce their waste.Parkkinen says that the founders had little savings when establishing their enterprise.“Even if we ourselves worked without pay, some expenses are inevitable at the start. Now we were able to kick off more quickly.”From the very start, ResQ Club’s services have attracted interest among both investors and consumers.With private individuals and venture capitalists as new investors, the company issued a financing call of over 300,000 euros. At the same time, ResQ Club announced that the service is also being launched in Sweden.The service has about 20,000 registered users and 150 partner suppliers.FACT: What’s a Start Guarantee? The Start Guarantee is intended for start-ups and enterprises that are no more than three years old. The enterprise must be owned by private individuals. The Start Guarantee is particularly well suited for small-scale financing, especially if the entrepreneur has insufficient collateral for the bank. Finnvera’s guarantee coverage is at most 80 per cent. The total amount of Start Guarantees granted to an enterprise cannot exceed 80,000 euros, in which case the maximum loan sought from a bank under the Start Guarantee is 100,000 euros. For collateral, the principal shareholders lodge special guarantee undertakings that must cover at least 25% of Finnvera’s guarantee sum. The enterprise presents the financing application to its own bank. Thereafter, the bank assesses the credibility of the business and checks the calculations and the applicants’ creditworthiness before granting financing. The bank submits the application for the Start Guarantee to Finnvera on behalf of the enterprise. The Start Guarantee is intended especially for the working capital and investment needs of start-up enterprises. It cannot be used for financing company acquisitions or purchases of business premises. The Start Guarantee may also be one part of the enterprise’s aggregate of loans. The maximum repayment period for loans under the Start Guarantee is ten years. More information about the Start Guarantee is available here.More financing solutions for setting up a company are found here.Text: Kimmo Koivikko

Press Releases
27.05.2016
Argentina opening up after 15 years – new export opportunities for Finnish companies

In South America, the Argentinian economy is gradually opening up for foreign business again. Finnvera’s experts see opportunities for Finnish companies in Argentina.Argentina’s economy collapsed at the turn of the millennium and, owing to unpaid debts, the country remained outside international financial markets for many years. However, the new conservative administration has taken quick action to resolve any unsettled disputes with Argentina’s creditors. In consequence, the country is gradually able to renew its relations with international providers of financing. The new Government has also lifted the restrictions on foreign trade.According to Jussi Haarasilta, Executive Vice President at Finnvera, Argentina is gradually becoming a potential export country for Finnish companies.“Necessary reforms were neglected during Argentina’s long period of isolation. For instance, the infrastructure is in urgent need of development, and that’s where Finns might well have a lot to offer in the coming years. This could mean, for example, telecommunication and electricity networks, mining, wood processing and the construction of harbours,” Haarasilta lists.“In short, the traditional Finnish export portfolio is well suited to Argentina’s future needs.”Haarasilta stresses that with its population of 43 million, Argentina is now becoming an attractive market for many companies.“Competition will be stiff for certain,” he predicts.“Realisation of large projects calls for financing, which in turn requires that the counterparty is creditworthy. Argentina was outside export credit guarantees for years. At present, Finnvera can support the financing of trade and is investigating how to guarantee long-term credits,” Haarasilta says.“It pays to look into partners’ backgrounds”Many companies have already contacted Finnvera to inquire about the situation in Argentina. Senior Adviser Mika Relander visited Argentina recently and underlines that even if Argentina offers promising opportunities, companies considering business there should still exercise caution.“The operating environment continues to involve risks, especially in the public sector, as the country’s economy is still rather weak and will require many long-term reforms. Good examples are the large subsidies for electricity and petrol prices that need to be dismantled before the public economy can be balanced.”“Otherwise, too, it pays to investigate customers’ solvency and the partners’ backgrounds in advance together with Finnvera,” Relander says.However, according to Relander, Finnvera always strives to seek and tailor financing solutions that would make the export transaction possible.“Still, in the case of Argentina, we also need to be rather cautious,” he adds.Additional information:Jussi Haarasilta, tel. +358 29 460 2601, jussi.haarasilta (at) finnvera.fiMika Relander, tel. +358 29 460 2725, mika.relander (at) finnvera.fi

Articles
26.05.2016
A growth entrepreneur’s tip for a good team: Don’t hire your course mate

Recruiting the right people and the owners’ capacity to take risks are crucial for a company’s growth.Everyone makes mistakes, but you should learn from them, growth entrepreneur Lennu Keinänen urges.Keinänen says that he himself has stepped on all possible mines, from market analyses to financing. Despite that, he has taken part in founding nine enterprises. Of these, the best known is Paytrail, a provider of online payment services. The Danish company Nets acquired 80 per cent of the enterprise two years ago.However, Keinänen identifies the team and its importance as the biggest mine.“Team members must have  sufficiently diverse backgrounds. It’s not necessarily a good idea to hire your course mate,” Keinänen points out.In his view, building the right team can start once the entrepreneur understands what he or she is actually doing.“Corporate culture must be created first. In the end, culture is shaped only through people, but its desired state must be known so that the entrepreneur can make the right recruitment choices.”Despite his young age, Keinänen has already been an entrepreneur for 20 years. He set up his first enterprise, in Kuopio, at the age of 15. Growth, internationalisation and financing are all interlinked. Growth has always been at the core of Keinänen’s enterprises as well.“Growth calls for bigger thinking, that is, leaving one’s own sandbox. One of the worst things is underfunding. Growth is always more expensive than you had originally thought,” says Keinänen.He agrees with Kim Väisänen, a successful entrepreneur who says that a company has only one crisis and that is the cash crisis.From bikinis to a growth trackStudies indicate that young people are eager to start their own enterprises. Young entrepreneurs have recently gained visibility otherwise, too, with the selection of the Young Entrepreneur of the Year in Jyväskylä last Friday.Last year this recognition went to Varusteleka, which has also sought growth outside Finland.One of the finalists this year was Biancaneve of Tampere, a maker of individual sports garments. Biancaneva was ranked third in the national competition. Entrepreneur Elina Loueranta acknowledges that she has also stepped on various mines.“My dream was only to make clothes. At first I didn’t even calculate any profit margins,” Loueranta says.The awakening came three years ago at a growth camp where other companies were making plans for internationalisation. “We were so small next to the others. One company was selling a million screws to Russia and we were talking about bikinis. We were asked if we really believed that we could grow and become international. It didn’t occur to me to answer that each bikini cost 600 euros,” Loueranta recalls.Not even all of the team members believed in growth. The entrepreneur says that one team member aroused doubt in the others, too.Intervening in the situation required a lot, but it was necessary.“I stood up from behind the sewing machine and started to look at the big picture,” Loueranta says.With its turnover of about half a million euros, Biancaneve is living a strong growth phase. This summer, the company is launching a webcam service that will allow customers to order Biancaneve’s tailored bikinis from anywhere in the world.At present, growth is brought by a luxury-focused sportswear collection designed for women. The marketing of this product line also takes the entrepreneur outside Finland.“We wanted to go abroad and we were asked whether we were ready to travel. Now this has come to pass. Relations can only be created face to face,” Loueranta concludes.FACT: Ways to break the glass ceiling on growthAccording to research, one out of five enterprises has hit the glass ceiling on growth.The main factors keeping a glass ceiling on growth are sales and marketing skills, the availability of competent staff, the acquisition of financing and the capacity of owners to take risks.Growth entrepreneurs believe that the glass ceiling can be broken if the management or the owners have sufficient capacity to take risks. That is the most important single way. Other important ways are product and service innovations, sales and marketing expertise, the availability of competent personnel and customer demand.Obtaining adequate financial resources is another tool for breaking the glass ceiling.This information is based on the Growth Enterprise Survey, conducted by the Kauppalehti business periodical and sent to 715 entrepreneurs, of whom 92 responded.There are several financing solutions for working capital needs and for starting business abroad.Text: Kimmo Koivikko

Press Releases
20.05.2016
Finnvera to speed up the financing of small export transactions

For its own part, Finnvera wants to ease the financing of smaller export transactions carried out by enterprises. The first step is the new Bill of Exchange Guarantee, which is best suited to transactions of less than two million euros.Finnish exports are concentrated in a few sectors and are dominated by large corporations. SMEs account for only about 15 per cent of the total value of exports.“It is evident that Finland needs more SME exporters. In general, simpler financing options should be available for small export deals. Complex credit documents and their high costs are often obstacles to financing the smallest transactions. The first product we are launching is the Bill of Exchange Guarantee, where we have considerably relaxed our requirements for both the exporter and the bank. We’ll continue making our services increasingly responsive in order to help Finnish exporters in their sales efforts,” says Executive Vice President Jussi Haarasilta.A bill of exchange is a traditional means of paymentThe use of bills of exchange has gradually increased in foreign trade in recent years. The bill of exchange serves both the exporter and the buyer because the exporter is paid in cash while the buyer is given payment time. Finnvera’s Bill of Exchange Guarantee, in turn, protects the bank from any credit losses that might arise. Compared to a loan agreement, for example, a bill of exchange is a quick and cheap payment instrument.“Our new Bill of Exchange Guarantee requires no security for small transactions of under two million euros. We trimmed the contents of the guarantee agreement and simplified pricing. We also cover risks stemming from the application of laws and regulations on bills of exchange that have been passed in various countries. We want to boost transactions of this size class in particular by increasing flexibility in our guarantee terms associated with export bills of exchange,” Team Leader Eeva-Maija Pietikäinen explains.The exporter applies for the guarantee from Finnvera and submits credit data and financial statements on both the buyer and the guarantor, if any, over the past two to three years. Additional information is requested, if necessary. Finnvera always makes guarantee decisions individually for each project.Finding the right kind of payment method requires cooperation with the exporter, the exporter’s bank and Finnvera. It is essential that the financing is planned well in advance before the conclusion of the export transaction. In this way it is possible to select the payment method that suits each export deal. This is important particularly for bills of exchange because not all countries use them as a means of payment.Additional information:Jussi Haarasilta, Executive Vice President, tel. +358 29 460 2601Eeva-Maija Pietikäinen, Team Leader, tel. +358 29 460 2674Products > Export Credit Guarantees > Bill of Exchange Guarantee

Articles
17.05.2016
Change is good

Marju Silander, Managing Director of the Women Entrepreneurs of Finland, sees many solutions for improving the state of the economy. One key factor is to seek growth through internationalisation and transfers of ownership.Finnish working life and enterprise structure have been in turmoil in recent years. Marju Silander, herself an entrepreneur by background, has been on the front line of this restructuring. Prior to her appointment as Managing Director of the Women Entrepreneurs of Finland, Silander had earned her stripes, among others, at the Regional Organisation of Enterprises in Helsinki.“We have changed from a Finland of large corporations to a Finland of micro-enterprises.”According to Silander, Finnish legislation is still living in the time of large corporations even though the current Government strives to revise the structures of working life and to dismantle unnecessary regulation.“Most jobs are created in small and micro-enterprises. By following the Think Small First principle of the EU, Finland Ltd could be brought to the present day,” Silander ponders.Small enterprises face a new situationSilander is concerned about the lack of international growth. Economic growth centring on Europe does not seem to trickle to Finland.“Small enterprises face the challenge of how to reach the international growth market. A strong domestic market is not enough to stop the spiral of increasing government debt: in practice we are sitting at the same table circulating money from one purse to another,” Silander summarises the situation.She believes that technology-driven industries, in particular, have growth potential. Sustainable development and the circular economy, ageing of the population and the health and wellness boom offer diverse opportunities for creating new products and services for the international market. Younger entrepreneur generations also have the enthusiasm to venture out into the world.“It’s no longer necessary to think that first we’ll establish a company and then we’ll go international. Instead, there can be a bigger picture from the very start,” Silander says.Being an entrepreneur has become attractive: young entrepreneurs are increasingly eager to seize the opportunity to build exactly the kind of life they have dreamed for themselves.“In addition to the cultural shift, the many years of entrepreneur training given by educational institutions and entrepreneur organisations are finally starting to bear fruit,” Silander rejoices.Transfers of ownership add momentum to Finnish work life Internationalisation is not an option for all entrepreneurs. Certain local services cannot be globalised or digitised, and boosts for business must be sought through other means. Silander says that transfers of ownership are a pivotal tool for growth in the Finnish economy.“At present we have more than 80,000 entrepreneurs over 55 years of age. Nearly one third of them have announced that they will wind up their business when they retire. It is also known that, in general, one transfer of ownership affects on average four people. This means that many jobs are in the danger zone,” Silander ponders.Lack of information is one reason why there are so few transfers of ownership.“Especially sole entrepreneurs are often too modest when putting a value on their enterprise. As a trade association within the Federation of Finnish Enterprises, we also conduct serious dialogue with Finnvera about how we could make entrepreneurs understand the realisable value of their enterprises so that they can continue to offer jobs in the future as well,” Silander explains.She mentions a case where a woman entrepreneur was about to wind up her enterprise for good, but decided in the end to ask for advice about selling the enterprise. The outcome was that the entrepreneur was able to supplement her pension income with a profit of nearly 10,000 euros by splitting up the company’s inventories and operations into packages ready to buy.“In a way, we squander our assets if no deals are made. Entrepreneurs should feel proud and pleased for having created something that is useful for others, too,” says Silander.Finding the right partner is rewardingFor a starting entrepreneur, buying an existing enterprise is an excellent way to pick up speed quickly. The entrepreneur does not need to start from scratch, since networks, premises and processes are already available. In fact, persons who have become entrepreneurs by buying an enterprise are on average more satisfied with being an entrepreneur and feel that they have made a go of it.According to Silander, buyers’ knowledge of company acquisitions is also scanty.“Many people come to Enterprise Agencies with their own ideas. If the idea isn’t viable, it could be proposed that a development partner be sought in an existing enterprise,” Silander suggests.When a novel idea is combined with an operating enterprise, the result may be something brand new. Earning money on the basis of one’s own idea will then take less time and, on the other hand, the idea may also be refined in the process.What’s more, transfers of ownership are an excellent way to expand existing business operations.“When two enterprises are put together, the result may sometimes be greater than two. It would be really valuable to get people together at an earlier stage instead of waiting until the enterprise has suffered from years of underdevelopment,” Silander sums up.Silander compares selling an enterprise to selling a home: usually everyone selling their home makes sure that they get as good a price as possible when closing the sale. She urges entrepreneurs to keep this philosophy in mind at every stage of developing their companies. Quotes “Finland is such a small country that cooperation is extremely important. We cannot waste time by arguing among ourselves; instead, we must stand as a united Finland against China, Germany or Sweden.” “If the only plumber in the village closes up shop, it should be in the interest of towns and municipalities to look for a new entrepreneur in the locality rather than letting operations cease and allowing residents’ basic services to decline.” “Business Infrastructure Analysis, which is a public service provided free of charge, is an excellent way of keeping abreast of a company’s development potential and value. It would be good if every company were given a kind of ‘annual inspection’ at certain stages of the life cycle.”Text: Noora Puro Photo: Heidi Strengell

Articles
12.05.2016
A tip for growth companies: abroad the use of money doubles

It often comes as a surprise when sales lag behind expectations. An entrepreneur’s advice is to seek local partners.Growth companies entering international markets badly underestimate their need for financing.There are many reasons for this.The most common reason is that the business launches organised by enterprises abroad are in fact much more expensive and more time-consuming than had originally been planned.The discrepancy between plans and reality is explained, among others, by unexpected turns of event and more sluggish sales of products or services on targeted markets.“The costs are always at least twice as much, and the need for external financing three times greater than what had been planned. When drawing up their budgets, companies are slightly overoptimistic. The fact is that an enterprise must get loads of visibility on the consumer market. Achieving credibility in business between companies takes time,” says Titta Mantila, Vice President, SME Financing at Finnvera.She heads the Growth and Internationalisation Team at Finnvera.According to Mantila, Finnish companies are told repeatedly about the importance of sales skills. However, skills in financing and economics should not be underestimated.Shareholders’ equity should account for almost one third of the total need for financing. Additionally, it would be good to think about what happens to the company if everything goes wrong abroad. In other words, risk tolerance.“Nor does it hurt to learn about the target countries and their business culture,” Mantila continues.There are no major differences in the financing needs of growth companies and companies with a slower growth pace. Working capital is the most common reason for seeking external sources of financing.With growth companies, everything is just a lot bigger. The financing granted to a growth company by Finnvera is on average about EUR 400,000.“No one can set up an international business with 100,000. Companies turn to us to obtain financing for expanding their own organisation, recruitment, sales and marketing, and for launching on international markets,” Mantila lists.She says that, for instance, Finnvera can offer several financing solutions for working capital needs and starting business abroad.Seek partnersKatja Lindy-Wilkinson, Marketing Director of Picote Oy Ltd and CEO of Picote Solutions Inc., admits that a perpetual shortage of resources has also slowed down the growth of the company based in Porvoo, Finland.The company renovates drainage pipes and develops and manufactures pipe lining tools, and has been able to forge ahead abroad in step with financial resources.“Equipment sales abroad began in 2012. Our German partner wanted to become a reseller, and that gave us a good start,” Lindy-Wilkinson reminisces.Today, foreign buyers account for 88 per cent of Picote’s equipment sales. The company, with a turnover exceeding six million euros, has 19 resellers around the world.Lindy-Wilkinson, who has lived in the United States for years, says that resellers are supported in many ways in their efforts to succeed. In return, resellers bring added value with their knowledge of the local markets.“The chances of success are much better if you find local partners. It’s also worth remembering that there are many Finnish expatriates living all over the world. We, too, hired a Finnish consultant in the USA. That person was an excellent support for us,” Lindy-Wilkinson says.FACT: Does the lack of money slow down growth? According to companies, the main factors keeping a glass ceiling on growth are sales and marketing skills, the availability of competent staff, the acquisition of financing and the capacity of owners to take risks. During the first months of the current year, Finnvera’s financing for enterprises exceeded 300 million euros. Growth companies accounted for 49 per cent of this. Despite their potential, not all companies seeking solid growth have a long, economically profitable history behind them. In consequence, their rating may not be high enough. Rating affects the price and availability of money. The rule of thumb is that loan financing must be accompanied by a sufficient amount of equity. It can be considered that 30 per cent is a sufficient amount. Text: Kimmo Koivikko

News
04.05.2016
The Growth Loan for faster growth and internationalisation

At the beginning of April, Finnvera’s selection of financing services was supplemented with a new loan product, the Growth Loan.Kalle Åström, Program Manager at Finnvera’s SME Unit, for what types of projects is the Growth Loan designed?– The Growth Loan is intended for financing SMEs and midcap companies in major growth and internationalisation projects or corporate reorganisation. The idea is that the loan would attract financiers operating on market terms to invest in projects where risks are high but profitability and effectiveness are deemed to be good.Who can apply for a Growth Loan?– Finnvera’s Growth Loan may be granted to SMEs and midcap companies that have been in operation for over three years. The loan is not suited for the very start of business or for small projects. In these situations, some other financing product we provide may be the solution; for instance, Finnvera’s Start Guarantee, where the bank submits the guarantee application to Finnvera on behalf of its customer.The Growth Loan is a debt-based mezzanine financing product that combines the features of both equity and debt financing. The company’s self-financing portion must always be at least 20% and the share contributed to the total financing by financiers other than Finnvera must be at least 50%.The Growth Loan is granted for each project on a case-by-case basis. Project profitability and eligibility for financing are assessed together with other financiers.Read more: Growth Loan

Articles
27.04.2016
Young people are increasingly entrepreneurial

Interview of Joonas Mikkilä, Organization Manager at the Federation of Finnish EnterprisesFederation of Finnish Enterprises’ survey reveals: University students, in particular, have embraced entrepreneurship. One out of five students sees being an entrepreneur as a probable career direction.How has interest in entrepreneurship developed among young people?JOONAS MIKKILÄ: Attitudes are undergoing a major generational shift. In consequence, the young people entering the labour market now are increasingly entrepreneurial. According to the Global Entrepreneurship Monitor survey, in 2015 as many as 20 per cent of young people between 18 and 24 years of age deemed that they would set up an enterprise within the next three years. At the turn of the millennium, only a few per cent of the same age bracket thought in this way.How actively do Finnish young people start enterprises when compared against young people in other countries?JM: Fairly actively. About five per cent of working Finns under 30 years of age work as entrepreneurs. In the rest of the Nordic countries, the ratio of young people working as entrepreneurs is 2–4 per cent. The EU average is about seven per cent.How are young people encouraged to become entrepreneurs in Finland and what kind of mentoring is available?JM: The development of entrepreneur training in basic and upper secondary education has been one of the focal points of Finnish education policy since the 1990s. The results are now becoming clearly visible. Universities have also gradually realised the importance of entrepreneur education for strengthening young people’s skills on the labour market. University students themselves have also established communities that promote growth enterprise culture on campuses.The association Suomen Yrityskummit provides mentoring for young entrepreneurs. Enterprise Agencies, in turn, give high-quality enterprise consulting to people planning to start a business. Business accelerators, operating in connection with universities and regional development companies, provide services for those seeking faster growth. Our Young Entrepreneurs programme aims to offer peer support and ready-made networks for starting entrepreneurs.What are the biggest challenges facing a young entrepreneur?JM: Apart from financing, many young entrepreneurs seeking to expand their operations are concerned about the risks involved in employing people. The significant increase in the number of one-person firms in the 2000s is an indication of the high threshold for hiring others and the rigidity of our labour markets. In certain sectors, the amount of regulation and administrative oddities also causes concern. How is financing arranged?JM: Getting financing from a bank is currently challenging for a starting entrepreneur who has little capital. However, supplementary financing from Finnvera and Tekes has helped to ease the situation. New crowdfunding forms are also becoming clearly more popular.  How could young people be inspired to buy already existing companies?JM: Persons who engage in entrepreneur training and consulting must communicate to young people that continuing the operation of existing companies is an excellent channel to entrepreneurship. As entrepreneurs age, these opportunities will be available increasingly often in the coming years.  Additional information:www.yrityssuomi.fiwww.uusyrityskeskukset.fiwww.yrittajat.fiwww.nuoretyrittajat.fiwww.yrityskummit.fiwww.nuoriyrittajyys.fiwww.yes-keskus.fiPhoto: Jaakko Översti

News
19.04.2016
Crisis awareness has increased – companies seek protection against Russian risks

Finnish exports to Russia fell by one-third, but inquiries about Finnvera’s guarantees come in steadily.Lower oil prices, the weak rouble and the sanctions imposed in consequence of the Ukrainian crisis have cramped Finnish companies’ exports to Russia.According to customs statistics for last year, exports to Russia plummeted by 32 per cent, to EUR 3.2 billion. The first months of the current year have not changed this trend.The last time when exports fell below four billion euros was in 2003. At the same time, Russia has dropped to rank fifth among the most important export markets.As a counterbalance to the gloomy news, enterprises have fortunately woken up to the situation.According to Jussi Haarasilta, Executive Vice President at Finnvera, companies’ crisis awareness has increased and they more actively seek to protect their claims.“We want to advance Finnish companies’ opportunities to engage in export trade. We will therefore continue to grant guarantees for exports to Russia, but we will observe how larger transactions, in particular, affect the level of total exposure,” says Haarasilta.Outstanding commitments have remained steadily around 1.5 billion. This accounts for a little less than ten per cent of total outstanding commitments.“Even now we have dozens of clients that export to Russia. There is a constant flow of inquiries about guarantees. Immediately after the sanctions were imposed, many companies hurried for guarantees, but not all projects have proceeded,” says Haarasilta.Know your partner’s backgroundMost of Finnvera’s guarantee commitments involve the exports of large corporations. According to the Finnish-Russian Chamber of Commerce, hundreds of companies carry out regular exports to Russia.“We grant short-term credit insurance for good buyers, but since the outbreak of the crisis, payment defaults have increased. We are particular about the buyer’s creditworthiness. In large projects that require credits, export credit financing is often channelled through a bank that is backing the Russian buyer,” Haarasilta explains.He advises companies to investigate their trading partners’ background.“Who is the buyer and the actual owner of the company making the purchase. The seller may start to pursue the issue too easily, without verifying the background.”Russia’s economy will continue to slip this year. The IMF’s forecast for the change in the GDP is -1.8 per cent. The situation caused by the sanctions adds to economic uncertainty.“The weak economic situation has caused a cut in imports. This means that many important investments or supplies for maintenance are sorely needed. This may gradually be seen in demand for imports in some sectors,” Haarasilta believes.Finnvera has many tools for financing and guarantees that companies can use in their exports. More information about the various alternatives is available at: www.finnvera.fi/eng > Export.Text: Kimmo Koivikko

Press Releases
19.04.2016
Survey: Only half of all Finnish SMEs keep an eye on enterprise value

Half of all decision-makers in Finnish SMEs follow changes in the value of their enterprises. Less than half of all Finnish SMEs have made preparations for ownership changes. These are some of the findings of a survey conducted among Finnish SMEs.Each year thousands of companies find themselves in a situation where they have to find a new owner for their business. Despite this, more than half (56%) of them have not made any plans for the situation. Retention of value is a particularly low priority in companies with the smallest number of employees and the lowest turnover.- It should definitely be a greater concern. Making sure that the company retains its value should be a top priority and the owner should also develop the business operations throughout the company’s life cycle. This helps to ensure that the company is in good shape when a new owner has to be found, says Katja Keitaanniemi, Executive Vice President, SMEs at Finnvera.Finnvera, the Federation of Finnish Enterprises and the Ministry of Employment and the Economy jointly conduct the SME Barometer Survey twice a year. In this year’s survey the respondents were specifically asked about changes in ownership. About 6,000 SMEs took part in the spring 2016 barometer and the findings on ownership changes are based on the responses provided by them.Boosting growth through company acquisitionsEven though company acquisitions may be a good way of expanding business, some 80 per cent of all SMEs taking part in the survey said that they are not interested in acquiring other companies or business operations. However, strongly growth-oriented companies see more opportunities in this area and about 40 per cent of them said that they would be interested in such acquisitions.- From the perspective of growth, acquiring an existing company would open up new opportunities and it might also be smarter economically than organic growth. A company acquisition is also a good idea for new entrepreneurs because that would give them a well-tested business concept for further development, explains Anssi Kujala, Deputy Managing Director of the Federation of Finnish Enterprises.The Yrityspörssi website of the Federation of Finnish Enterprises is a place where companies are sold and acquired. It is Finland’s largest market place for SMEs and nearly 25,000 people interested in company acquisitions check the ads on the site each month. Yrityspörssi now also provides basic information about valuation, business practices, financing and taxation. In addition to the nationwide Yrityspörssi, there are also ten regional Yrityspörssi websites.Further information: Katja Keitaanniemi, Executive Vice President, SMEs, Finnvera plc, tel. 029 460 2888 Anssi Kujala, Deputy Managing Director, Federation of Finnish Enterprises, tel. 0400 567 925Finnvera provides financing for the start, growth and internationalisation of enterprises and guarantees against risks arising from exports. Finnvera strengthens the operating potential and competitiveness of Finnish enterprises by offering loans, guarantees and other services associated with the financing of exports. The risks included in financing are shared between Finnvera and other providers of financing. Finnvera is a specialised financing company owned by the State of Finland and it is the official Export Credit Agency (ECA) of Finland. https://www.finnvera.fi/eng/ https://www.finnvera.fi/eng/Finnvera/Media/Media The Federation of Finnish Enterprises promotes the interests of small and medium sized enterprises in Finland. With a membership of more than 115,000, 400 local associations, 20 regional organisations and 63 branch organisations we are Finland’s largest business federation. Self-employed individuals account for half of our members, while the other half consists of employer enterprises. Our members provide employment for about 650,000 people. Further information: http://www.yrittajat.fi/en-GB/. http://www.yritysporssi.fi/en

Press Releases
11.04.2016
Brazil continues to provide export opportunities for Finnish companies

Brazil is expected to play a major role for Finnish exports in the coming years as well. Despite the current economic difficulties, it is believed that Brazil will continue to offer business opportunities in many of the strong sectors of the Finnish export industry.According to Jussi Haarasilta, Executive Vice President at Finnvera, Brazil is an important and, above all, growing market from the viewpoint of Finnish enterprises.“Brazil’s devalued currency, the real, stimulates demand in the export-oriented sector of wood processing and pulp manufacture. Moreover, the great potential in the country’s bioenergy and cleantech sectors is finally being realised and, as we know, Finland has volumes of first-rate expertise in these fields,” says Haarasilta.“In addition, Brazil has made extensive investments in telecommunications, which has also benefited Finnish enterprises.”Haarasilta says that Brazil’s economy of 200 million people would also have great demand for consumer goods.“The consumer market will certainly experience vigorous growth in the future. So far Finland’s exports to Brazil have focused on capital goods and, at least yet, Finland has not been able to profit from the consumption potential of the growing middle class.”Economic recession is hoped to remain shortJussi Haarasilta judges that Brazil’s economic problems and domestic policy crisis inevitably make an impact on the business environment of foreign enterprises in Brazil, at least to some extent.“It is clear that more caution and deliberation than normally is advisable when planning business deals in Brazil. However, I’d like to stress that despite the current problems, Brazil has many good enterprises and sectors that can serve as trading partners,” he says.“In the longer term, Brazil still has much potential as an export country for Finland, and sales to Brazil could be much higher than at present. We naturally hope that the recession of the Brazilian economy will be as short-lived as possible.”According to Haarasilta, Finnvera for its part is willing to support Finnish companies’ export efforts in Brazil as well, but keeps a close eye on the development of the country’s economy.“The more contracts Finnish export companies can win, the better it is for the whole of Finland.”Finvera’s guarantees for exports to Brazil account for the third highest country exposure among all countries. Apart from Finnish companies’ active efforts in Brazil, the exposure is explained by the fact that individual transactions in Brazil often have a very high monetary value.Additional information:Jussi Haarasilta, Executive Vice President, tel. +358 50 346 95 37

Press Releases
08.04.2016
Finnvera’s authorisation to provide export financing was raised

The ceilings for the Finnvera Group's export credits and export credit guarantees have been raised. The Finnvera Group can continue to provide Finnish export companies with internationally competitive financial arrangements for their export transactions. The legislative amendments will enter into force on 15 April 2016.The authorisation to grant export credits will rise from EUR 7 billion to EUR 13 billion, while the authorisation to grant export credit guarantees will rise from EUR 17 billion to EUR 19 billion. The authorisation to provide interest equalisation will also increase, from EUR 7 billion to EUR 13 billion. The purpose of the increases is to improve the competitiveness of Finnish companies engaged in the exports of capital goods and to enhance their opportunities to secure export contracts.– “Long-term financing plays an important role in negotiations for export-related purchase agreements. Bank regulation has affected banks’ possibilities to finance long loan periods. For this reason, Finnish Export Credit Ltd is needed in large financial arrangements. Some individual large export deals have increased our exposures close to their maximum limits. The increases in the authorisations enable Finnvera to participate in financial arrangements for Finnish companies’ export transactions and for their foreign buyers in the coming years as well,” says CEO Pauli Heikkilä.The parent company Finnvera’s total commitments for export credit guarantees and special guarantees amounted to EUR 17.4 billion at the end of December 2015. The outstanding commitments for export credit guarantees in accordance with the ceiling laid down by law totalled EUR 14.2 billion. The outstanding export credits and ship credits granted by the subsidiary Finnish Export Credit totalled EUR 4.2 billion. The granting of export and ship credits always requires an export credit guarantee. In other words, the risks associated with the project are covered with an export credit guarantee. According to the goal of economic self-sustainability set for Finnvera’s operations, the income received from the company’s operations must, in the long run, cover the company’s operating expenses. The self-sustainability of export financing has been realised over Finnvera’s history of 17 years, and Finnvera’s operations have not caused any costs to the State.Finnvera acquires the funds needed for credits from the market, by issuing State-guaranteed notes. The maximum amount of loans guaranteed by the State was raised from EUR 9 billion to EUR 15 billion. Additional information:Pauli Heikkilä, Chief Executive Officer, tel. +358 29 460 2400Jussi Haarasilta, Executive Vice President, tel. +358 29 460 2601

Press Releases
23.03.2016
Finnvera’s Annual General Meeting: New members appointed to Finnvera's Supervisory Board - No changes in the composition of the Board of Directors

On 23 March 2016, Finnvera's Annual General Meeting elected new members to the company's Supervisory Board. No changes were made to the composition of the Board of Directors.The new members of the Supervisory Board are Laura Huhtasaari, Timo Kalli, Krista Kiuru, Kari Kulmala, Ville Niinistö and Eero Suutari, Members of Parliament; and Kari Luoto, Managing Director; Carita Orlando, Managing Director; and Christel Tjeder, Second Vice Chairman.Antti Rantakangas, Member of Parliament was elected Chairman and Krista Kiuru, Member of Parliament Vice Chairman of the Supervisory Board. Eeva-Johanna Eloranta, Member of Parliament; Mika Harjunen, Information Security Manager; Lasse Hautala, Member of Parliament; Olli Koski, Chief Economist; Leila Kurki, Senior Adviser; Veli-Matti Mattila, Chief Economist; Tommi Toivola, Senior Adviser; and Sofia Vikman, Member of Parliament will continue as members of the Supervisory Board.Markku Pohjola, B.Sc (Econ.), will continue as Chairman, Pekka Timonen, Director General, as First Vice Chairman and Marianna Uotinen, Specialist Counsel, as Second Vice Chairman of Finnvera's Board of Directors. The following persons will continue as Board members: Kirsi Komi, LL.M.; Pirkko Rantanen-Kervinen, B.Sc (Econ.); Harri Sailas, B.Sc (Econ.); and Antti Zitting, Chairman of the Board.The Annual General Meeting adopted the Consolidated Financial Statements and the Parent Company’s Financial Statements for the period 1 January–31 December 2015, discharged the Supervisory Board, the Board of Directors and the Chief Executive Officer from liability, and approved the proposal made by the Board of Directors for the use of the parent company’s profits.KPMG Oy Ab was re-elected Finnvera’s regular auditor with Juha-Pekka Mylén, Authorised Public Accountant, as the principal auditor.Further information:Pauli Heikkilä, CEO, tel. +358 29 460 2400Risto Huopaniemi, Senior Vice President, Administration, Legal Affairs and Administration tel. +358 29 460 2520

News
18.03.2016
Finland and Cuba agreed on debt adjustment

A bilateral agreement pertaining to the State Guarantee Fund’s arrears of EUR 37.8 million from Cuba was signed in Havana on 17 March 2016. The arrears stem from export credit guarantees granted 30 years ago.The agreement was signed by Under-Secretary of State Pirkko Hämäläinen and Vice President of the Council of Ministers of Cuba Ricardo Cabrisas Ruiz. The bilateral agreement complements the arrears clearance negotiated in Paris on 10–12 December 2015. According to the agreement, Cuba repays the principal and contractual interest, in total EUR 7.7 million, within 18 years. The late interest that has accumulated is cancelled. However, cancellation of the late interest requires that Cuba repays the principal and interest as agreed. In summer 2015, Cuba paid its old, short-term arrears associated with trade finance contracts. The agreement now concluded continues this favourable trend.An important step for trade between Finland and CubaThe agreement that has now been signed is an important step for promoting trade between Finland and Cuba.  “Finnvera has already made guarantees available for small export transactions with Cuba and keeps a close eye on the country’s development as a potential trading partner,” says Senior Adviser Mika Relander.The State Guarantee Fund is organised under the Ministry of Employment and the Economy. Its receivables stem from export credit guarantees granted by Finnvera’s predecessors. Finnvera manages the receivables on behalf of the fund.Additional information:Mika Relander, Senior Adviser, tel. +358 29 460 2725

Press Releases
29.02.2016
Q4 and Financial Statements for the Finnvera Group 1 January–31 December 2015

A variable and record-breaking yearCompared against the previous year, the world economy gained a little momentum in 2015. However, the economy did not develop steadily; instead, situations and divergent estimates varied throughout the year. The subdued outlook for exports and low spirits on the domestic market kept the demand for SME financing for investments modest. In contrast, financing for working capital and credits for changes of ownership were in great demand. In exports, shipbuilding orders were the biggest single factor increasing the demand for financing. Finnvera’s contribution was also needed in some other large export projects.Business operations and the financial trend In 2015, Finnvera’s offers for export credit guarantees increased by 28 per cent, while offers to finance export credits rose by 46 per cent on the previous year. The volume of loans and guarantees granted to SMEs and enterprises larger than the SME definition applied by the EU was 19 per cent greater than the year before. Finnvera Group     1 Jan–31 Dec 2015  1 Jan–31 Dec 2014  Change % Offered financing           Loans and guarantees 906 MEUR 763 MEUR 19%     Export credit guarantees and special guarantees  6 760 MEUR 5 274 MEUR 28%     Export credits 4 131 MEUR 2 829 MEUR 46%   31 Dec 2015 31 Dec 2014 Change Outstanding commitments       Loans and guarantees 2 285 MEUR 2 378 MEUR -4%      Export credit guarantees and special guarantees  17 436 MEUR 12 600 MEUR 38%      Export credits 4 240 MEUR 3 330 MEUR 27%   1 Jan–31 Dec 2015 1 Jan–31 Dec 2014 Change % Net interest income and fee and commission income and expenses (net)  197 MEUR 189 MEUR 4% Operating profit 114 MEUR 101 MEUR 13% Profit for the period 111 MEUR 100 MEUR 11%   31 Dec 2015 31 Dec 2014 Change %-point Equity ratio 13.3% 15.2% -1.9% Capital adequacy, Tier 2  19.6% 18.6% 1% Cost-income ratio 28.3% 25.9% 2.4% The profit for the last quarter of 2015 was EUR 5 million. The figure was two thirds, or EUR 46 million, less than the profit for the previous quarter (51 million). The main factors affecting the smaller profit were the impairment losses on receivables and guarantee losses, which doubled and were EUR 33 million more than in the previous quarter. The increase in the impairment losses on receivables and guarantee losses between the two quarters was partly due to the reversal and reduction of impairment losses and provisions for losses, which took place in the previous quarter.The profit for the Group in 2015 was EUR 111 million (100 million). This was 11 per cent better than the year before. The main factor improving the financial performance was the decrease of 57 per cent, or EUR 19 million, in impairment losses   on receivables and guarantee losses. In addition, the increase of 8 per cent in the net interest income and the rise of 3 per cent in the net value of fee and commission income and expenses improved the financial performance.The profit of the parent company, Finnvera plc, in 2015 stood at EUR 95 million (92 million). This was 3 per cent more than the year before. When divided between the business areas, the parent company’s financial performance was as follows: the profit for export financing was EUR 82 million (96 million) and that for SME financing EUR 38 million (6 million). In addition, the impairment losses recognised on investments, EUR 25 million (9 million), had an impact on the parent company’s profit. Finnvera Group Q4/2015 Q3/2015 Change Q4/2014 Change *2015 *2014 Change Profit for the period MEUR MEUR % MEUR % MEUR MEUR % Net interest income 13 15 -12 10 35 56 52 8 Fee and commission income and expenses (net) 34 34 -1 35 -4 141 137 3 Gains/losses from items carried at fair velue -13 -2 - 4 - -21 -10 108 Other operating income 2 0 - 0 - 2 2 43 Administrative expenses -12 -9 32 -11 9 -44 -41 8 Impairment losses, guarantee losses -17 16 201 -9 84 -15 -34 -57     Loans and guarantees -21 6 444 -26 -22 -87 -105 -18     Credit loss compensation from the State 13 9 42 18 -28 83 64 30     Export credit guarantees and special guarantees -9 1 927 -1 - -10 8 232 Operating profit 5 53 -90 27 -81 114 101 13 Profit for the period 5 51 -90 25 -80 111 100 11 Outlook for financingEconomic growth and investments are likely to remain at a low level in 2016, and SME financing continues to focus on working capital needs. However, it is expected that the increase in changes of ownership and the investments disclosed by large corporations will have a positive effect on the demand for SME financing. In addition, Finnvera’s new mandates and financing products support the rise in the volume of SME financing.Financing solutions offered to buyers will continue to play a pivotal role in exports of capital goods sold by large   corporations. It is expected that the demand for export credit guarantees and export credits will decline slightly from the previous year if no individual major orders are placed in 2016. Ships, telecommunications and the forest industry are still anticipated to account for the bulk of demand associated with large corporations’ exports.According to the current estimate, the Finnvera Group’s financial performance for 2016 is likely to fall below that for 2015. The uncertainty factors associated with economic trends make it difficult to predict financial performance. If more risks materialise than has been anticipated, the situation may weaken considerably from what is projected.CEO Pauli Heikkilä:“The new tasks assigned to us added momentum to the year and increased the demand for our financing. We granted markedly more financing to SMEs than the year before. This rise was mainly attributable to our new mandates and to a positive   trend in changes of ownership. However, investments did not pick up yet; instead, SME financing continued to be needed mainly for working capital.The total value of offers pertaining to exports was record high. The orders for ships that followed the ownership arrangements    of the Turku shipyard, an event important from the point of view of industrial history, were the absolute highlight of the year and were also visible in our export financing. To provide financing for the buyer, export credit guarantees or, possibly, pre-delivery financing are needed in practice almost always for major shipbuilding projects. In consequence, ship financing will account for an exceptionally large share, or about one third, of our current commitments. The shipyard is an important employer in the Turku region and also has several hundreds of sub-contractors giving work to tens of thousands of  people.”Financial Statements 2015 (PDF)Statement on the Corporate Governance and Steering System 2015 (PDF)Additional information: Pauli Heikkilä, Chief Executive Officer, tel. +358 29 460 2400 Ulla Hagman, Senior Vice President, CFO, tel. +358 29 460 2458Distribution NASDAQ OMX Helsinki Oy London Stock Exchange The principal media www.finnvera.fiFinnvera publishes its Annual Report for 2015 as an electronic document on the company’s website in Finnish and English during week 10. The Annual Report also includes the Corporate Responsibility Report. The half year report 1 Jan–31 June of the company will be published on 11 August 2016.

Press Releases
25.02.2016
Finnvera supports Finnish exporters’ trading in Iran

Finnvera has revised its country policy for Iran after the EU’s economic sanctions were lifted in January. This means that Finnvera can begin to grant export credit guarantees for exports from Finland to Iran. Because of the sanctions, it is almost ten years since export credit guarantees were last granted for Iran.Since the economic sanctions were lifted, Finnish companies have shown interest in the Iranian markets.“We are ready to receive guarantee applications for exports. Our task is to support Finnish export companies in their efforts to secure contracts in Iran,” says Executive Vice President Jussi Haarasilta.According to Haarasilta, financing on new markets typically opens first between governments or banks. When more experience is gained, it becomes more common to provide financing for companies.Iran is a wealthy country and thereby a large market. This creates great potential for exports. Haarasilta assesses that, for instance, the modernisation of Iran’s basic infrastructure could bring opportunities for Finnish exporters.“Of course, it must be remembered that competition over contracts will be fierce. Many other countries have their eye on the Iranian markets, and the export credit agencies of several states have also relaxed their policies on Iran after the sanctions were cancelled.”“A challenging business environment”Jussi Haarasilta underlines that although trade with Iran will be easier once the sanctions have been suspended, projects should be prepared carefully in advance.“On the whole, the business environment is challenging but I encourage companies to explore business opportunities.”Haarasilta points out that some of the sanctions caused by the nuclear programme are still in force. Human rights sanctions remain in force, too, Haarasilta stresses.He also underlines that each export project is always assessed on a case-by-case basis at Finnvera.Iran is the world’s 18th largest economy. The International Monetary Fund (IMF) has predicted a growth rate of about four per cent for the Iranian economy in the coming years. Read more about Finnvera’s export credit guarantees and country policy.Additional information:Jussi Haarasilta, Executive Vice President, tel. +358 29 460 2601, jussi.haarasilta (at) finnvera.fi

Press Releases
16.02.2016
Internationalisation is the key to growth – SMEs have high expectations for growth in exports

Economic outlook for SMEs shows improvement. The desire for growth remains strong and export volume is expected to increase sharply. In the near future, SMEs will see a bit of light at the end of the tunnel for the first time in a long while. This positive outlook is reflected in the desire for growth, with more enterprises than before being growth-oriented: 9 per cent of enterprises report being strongly growth-oriented, while 36 per cent plan for growth wherever possible.SMEs are looking for growth on the international market and, according to the survey, export volume is expected to rise above current levels within the next year. A positive sign in all sectors is the increase in plans for internationalisation financing.However, outside financing is still being sought primarily for working capital, even though the investment percentage in strongly growth-oriented enterprises is already showing a slight increase. There have been no changes in the availability of financing compared to the results from last autumn. In any case, there are signs that the terms of financing are becoming more favourable, as over 80 per cent of the SMEs seeking financing stated that the availability of financing was not an obstacle to realising projects."Improvement of the economic situation in the euro zone can be clearly seen in higher expectations concerning the demand for export goods. The export share of Finnish SMEs is currently below the EU average, so it's of the utmost importance to find the internationalisation potential behind the Barometer results," says Finnvera's CEO Pauli Heikkilä.The Federation of Finnish Enterprises, Finnvera and the Ministry of Employment and the Economy jointly conduct the SME Barometer Survey twice a year. The aim is to examine the operations and economic operating environment of small and medium-sized enterprises. The spring 2016 Barometer Survey is based on the responses submitted by 6,000 SMEs.SME Survey on The Federation of Finnish Enterprises websiteFurther information:Pauli Heikkilä, CEO, tel. +358 29 460 2400Jonna Myllykangas, Communications Officer, tel. +358 29 460 2740

Press Releases
01.02.2016
Demand for export credits, new mandates and ownership arrangements gave momentum to 2015 for Finnvera

The economic situation posed challenges both to enterprises operating on the domestic market and to export companies. As in the previous year, continued uncertainty in the global economy dampened companies’ willingness to invest, make growth plans and take risks.However, a positive feature was the upswing in companies’ ownership arrangements, the first since 2012. It is estimated that Finnvera is involved in every third company acquisition. Otherwise, despite the improved investment expectations of SMEs, there was no change of course in the allocation of financing. It is four years since investments accounted for a larger share of financing offered to SMEs than working capital.Long-term financing played an important role in negotiations for export-related purchase agreements. Banks were still cautious when financing transactions requiring long repayment periods; in consequence, the role of Finnish Export Credit, in particular, was emphasised. Institutional investors participated in loan arrangements on credit markets slightly more than before but, owing to investors’ expectations for returns, demand and supply did not meet in export credits, with a few exceptions.In international comparison, Finland has well-functioning financial markets, and good projects receive financing from banks. However, the definition of a good project is more demanding than before. “Companies must have credible plans, a good balance sheet structure and adequate collateral. Finnvera is needed as a co-financier in projects especially at the start of enterprise activities and in various situations of change. Internationally, the impact of bank regulation is seen the most in demand for Finnvera’s export financing,” says CEO Pauli Heikkilä.A positive trend in ownership arrangementsIn 2015, Finnvera granted a total of EUR 1,116 million in financing to SMEs and to companies larger than the SME definition used by the EU. Of the financing granted, over 50 per cent was used to finance working capital. Loans and domestic guarantees accounted for EUR 906 million of the financing; this was 19 per cent more than the year before. The factors contributing to this increase included the mandate granted to Finnvera at the start of 2015 to provide financing for companies larger than SMEs, the increase in changes of ownership, and the restructuring of financing granted earlier. The value of guarantees granted to SMEs for exports totalled EUR 210 million, or 13 per cent less than the year before. In 2015, about 950 enterprises received financing for ownership changes. The total sum was EUR 116 million.At the end of 2015, outstanding commitments for SME financing totalled EUR 2.7 billion.The volume of offers for export credit guarantees increasedThe value of export credit guarantees and special guarantees offered rose by 30 per cent, to a total of EUR 6,550 million. Western banks think carefully before granting credits with long repayment periods, especially when they exceed five years. This underlines the importance of the Finnvera Group’s financing. Offers pertaining to the financing of export credits totalled EUR 4,131 million. This is nearly 50 per cent more than the year before. At annual level, the value of export credits offered was the greatest in Finnvera’s history.In total, 88 per cent of the export credit guarantees offered concerned the traditional sectors of Finnish capital goods exports, such as shipbuilding, telecommunications and the forest industry.At the end of 2015, outstanding commitments for export financing totalled EUR 17.0 billion.Additional information:Pauli Heikkilä, Chief Executive Officer, tel. +358 29 460 2400Finnvera publishes the financial statements for the period 1 January to 31 December 2015 on 26 February 2016 and the Annual Report during week 10.

News
18.12.2015
New export credit rules for coal fired power plants

OECD Participants to the Arrangement on Officially Supported Export Credits have agreed new rules on coal-fired power plants, including restrictions on export credits for the least efficient coal-fired power plants.The new agreement will remove support for large super and sub-critical coal-fired power plants, while allowing support for smaller sub-critical plants in poorer, developing countries. “After two years of intense negotiations, the agreement represents a first important step towards aligning export credit policies with climate change objectives to achieve lower emissions”, says Pekka Karkovirta, vice president for international relations in Finland’s export credit agency Finnvera and Chairman of the Participants to the Arrangement.The private sector is expected to follow suit in with the now agreed public sector agreement, which could mean increasing the emission cuts in the future. The new agreement will also improve the competitive position of the Finnish high technology.The 2015 United Nations Climate Change Conference in Paris negotiated a global agreement on reduction of climate change. The agreement was accepted by 196 countries and parties. The agreement sets a goal of limiting global warming to less than 2 degrees Celsius with an additional commitment to pursue efforts to limit the warming to 1.5 degrees. Finnish scholars and specialists have stated that Finland will benefit from the reduction of global warming economically. Finnish cleantech companies have developed technological solutions to curb emissions. We believe that global demand for Finnish cleantech companies will increase in the future.Finnvera supports exports of new clean tech technologiesThe OECD agreement on restricting financial support for certain coal fired power plants together with the UN agreement on restrictions of global warming is expected to enhance the competitiveness of technologically advanced Finnish companies in global trade. Finnvera will take an active role in financing Finnish technology exports to secure that the ambitious goal to limit global warming will be secured. Cleantech projects can benefit from export credits and guarantees with repayment periods up to 18 years.

News
17.12.2015
Finnvera revised its country risk classification

Finnvera monitors 140 political risk countries and classifies them into country risk categories 0–7, with category 0 as the lowest country risk rating. Country risk categories are reviewed by region once a year in cooperation with the other OECD members. At the latest meeting, it was time to update the classifications of countries in Latin America, the Caribbean, and Western and Central Africa. It was consequently decided that two countries would be upgraded in a better category and three countries downgraded in a weaker category.Despite the slowdown in global economic growth, the economies of many countries in the regions now considered have continued to grow, though some opposite trends have also occurred. Especially in countries that are dependent on the exports of oil and other raw materials, the economy has taken a negative turn as income from exports has shrunk. Despite the gloomier economic outlook, political and social stability has largely continued to evolve in a positive way.Brazil’s country risk category downgraded from 3 to 4Brazil’s economic growth has been slowing down for the fourth consecutive year and corruption scandals have fuelled a political crisis. In consequence, the outlook of South America’s largest economy is now clearly weaker than before. The prolonged political stalemate, faltering domestic demand, the falling prices of raw materials important for the country’s exports, and the inability to carry out the necessary structural reforms for achieving economic growth mean that Brazil’s prospects will remain negative in the coming years as well. In the longer term, however, Brazil is a large, strong and diverse economy that still has all the prerequisites for emerging from the recession and thriving. With its exposure of over EUR 1.8 billion, Brazil accounts for the third highest country exposure for Finnvera.Ghana’s country risk category downgraded from 5 to 6Concern over Ghana’s economic situation has continued for a long time. The country’s public debt has increased, economic growth is sluggish and the value of the currency see-saws. The economy is also burdened by low raw material prices. Ghana’s financing costs are high and currency reserves low. However, the political situation is stable, and the IMF and the World Bank have a strong presence in Ghana. Support by international financial institutions creates prerequisites for improving the situation in the future.The country risk categories of Benin and Ivory Coast upgraded from 7 to 6Benin is a politically stable country whose economy is expected to grow in the coming years. The central government debt is relatively low, and the focus in the coming years will be on making important structural changes and improving the business environment. Benin’s main trading partner is Nigeria, whose problems are reflected in Benin as well.Ivory Coast’s economic growth is very strong, as much as 7 per cent annually. The outlook for the near future is bright, the infrastructure is constantly being improved and effort is made to develop the business environment. The political situation is calm and creates a basis for long-range development.El Salvador’s country risk category downgraded from 4 to 5The country’s economic trend has steadily deteriorated at the same time as disagreements in internal politics make it more difficult to carry out the necessary structural reforms. However, El Salvador’s business environment is still at a reasonable level, and the revival of the U.S. economy promises better times for El Salvador’s economic prospects, too.Gradual opening of export credit guarantees for CubaFor many years, Finnvera has not granted export credit guarantees for Cuba. In September, Finnvera made Cuba eligible for short-term letters of credit guarantees after the country had repaid its short-term debts to Finnvera. The improvement of relations between Cuba and the United States has contributed to positive developments in Cuba. The launching of medium-term guarantees requires that Cuba and its creditors agree on the multilateral rescheduling of debts. Finland also has claims in Cuba.The situation in Iran is monitored closelyAn agreement in Iran’s nuclear programme negotiations was reached in summer. This started a process that, if successful, would bring Iran into the global economy. Economic sanctions are still in force and Iran is required to comply with the agreement closely under the supervision of the International Atomic Energy Agency (IAEA). For as long as the sanctions are in force, Finnvera cannot grant export credit guarantees for Iran. If the situation changes, the possibilities for making export credit guarantees available for Iran will be reconsidered. The lifting of sanctions will begin when the IAEA verifies that Iran complies with the agreement.

News
19.11.2015
OECD reached agreement on officially supported export credits on coal-fired power plants

OECD Participants to the Arrangement on Officially Supported Export Credits have agreed new rules on official support for coal-fired power plants, including restrictions on official export credits for the least efficient coal-fired power plants.“After two years of intense negotiations, the agreement represents a first important step towards aligning export credit policies with climate change objectives to achieve lower emissions”, says Pekka Karkovirta, vice president for international relations in Finland’s export credit agency Finnvera and Chairman of the Participants to the Arrangement.The new agreement, or rather, the new climate sector understanding under the  Arrangement on Officially Supported Export Credits, will remove support for large super and sub-critical coal-fired power plants, while allowing support for smaller sub-critical plants in poorer, developing countries.The private sector is expected to follow suit with the now agreed public sector agreement, which will mean leveraging the emission cuts in the future.“The new agreement is not seen to hinder the Finnish export industries, on the contrary it is more likely to improve the competitive position of the Finnish high technology coal power plant solutions”, says Pekka Karkovirta.The new Climate Sector understanding will be set in force on and as from 1st January 2017.The Participants to the Arrangement on Officially Supported Export Credits are: Australia, Canada, the European Union, Korea, Japan, New Zealand, Norway, the United States and Switzerland.For further information, please contact:Pekka Karkovirta, Vice President, International Relations, tel. +358 (0)29 460 2768In OECD website: http://www.oecd.org/newsroom/statement-from-participants-to-the-arrangement-on-officially-supported-export-credits.htm

News
25.09.2015
KPA Unicon opened an export window to Africa

KPA Unicon, a company based in Pieksämäki, Finland, opened an export window to South Africa and will deliver a boiler plant worth about ten million euros. Financial arrangements were very important for the success of the export Project.KPA Unicon specialises in the delivery of tailored and modular boiler plants on a turnkey basis.  In accordance with a recently signed contract, KPA Unicon will deliver a boiler plant to the South African subsidiary of ArcelorMittal, the world’s leading steel and mining company. KPA Unicon has about twenty years of experience of export projects. When trade with Russia began to wane, new markets had to be found. “We succeeded because we have a good product and can give a similar plant, delivered to the same global corporation, as a reference,” says Mikko Marttala, CFO of KPA Unicon.According to Marttala, this deal will bring vast amounts of credibility for the future. He stresses that, when entering a developing market, it is worth hiring an agent who knows the local actors. The biggest fear of the locals is that the foreign operator comes in and does everything in the Western style. “To be able to enter a new market, a company must have a systematic approach and be tenacious in its development work. The very first thing to do is to go to a trade fair where new contacts can be made. Patience is needed: for each successful deal there are certainly twenty failures. Much time must also be spent on site, because no deal can be concluded from Finland.”Customer financing opens doorsSelling equipment means engineers talking about screws and mechanical properties. Marttala has discovered that when financing is also discussed in the sales setting with the buyer, one gets a seat at the same table with the persons who actually decide on the deals. “A financing offer combined with sales opens doors and is really an important factor. At the same time the seller learns to understand the customer’s business better.”For new potential customers, financiers should be contacted at once in order to determine what financial arrangements would be possible. “This is what we do, and at the same time we also take a closer look at customer risks. Anyone can learn export financing; the more pertinent question is perhaps whether one has the time to concentrate on it.”Alongside selling, for some years KPA Unicon has offered its customers financing solutions worked out together with banks and Finnvera. “Today, financing begins to be a prerequisite for entering any competitive bidding at all. We often hear grumblings that Finnish companies cannot match, say, German companies. We can, but we just have to make a slight effort and learn to master this aspect of export trade as well.”In recent years, Finnvera has paid special attention to financing expertise needed for the exports and internationalisation of SMEs. “For the third year in a row, we have arranged the SME Export Finance Programme where we cooperate with banks to provide information about financing options available for enterprises that engage in exports. The aim is to give companies tangible solutions that they can use when making tenders to customers abroad. It pays for the exporter to find out about financing in good time and to discuss the matter with banks and Finnvera. Before making our decision, we conduct background studies pertaining to the project, for instance, on country risks and the buyer’s creditworthiness,” Finance Manager Otto Lindstedt of Finnvera explains.Exports as a precondition for existenceA couple of years ago, exports accounted for 99 per cent of KPA Unicon’s turnover, but now the figure is smaller. The company believes that imports to Russia and the rest of the CIS countries will revive.“In terms of risks, our situation is now healthier because we had to start looking for new markets. Once the decision is made, results start to appear. Our future target is that one third of our turnover comes from Finland, one third from the CIS countries and one third from other export markets. A precondition for our existence is that we have exports,” Marttala sums up.Marttala encourages exporters to discard the “I sell, you buy” thinking and contemplate what they could do together with the customer. “The more we see ourselves as partners, the better.”Read about Finnvera’s SME Export Finance Programme

Press Releases
08.09.2015
Positive energy – SMEs still growth-oriented

SMEs see the future as being perhaps a bit brighter, and the protracted economic uncertainty has not reduced their desire for growth. Outside financing is being sought for not only working capital, but now also enterprise development.Compared to the results of last spring’s SME Barometer Survey, the economic expectations of enterprises have taken a turn for the better. Nearly one out of every three SMEs expects the economic situation to improve in the next 12 months. Also where investments are concerned, the expectations are slightly better than before, even though the trend remained on the minus side.Despite the unstable economic situation, SMEs’ desire for growth and internationalisation is still moderate: 8 per cent of enterprises report being strongly growth-oriented, while 34 per cent plan for growth wherever possible.There has been no change in the availability of outside financing and SMEs intend on applying for it slightly more than before. Interest in outside financing has grown, particularly among strongly growth-oriented companies. Even though the desire to invest is currently weak, there are signs of an upturn. Financing is primarily being sought for working capital, and one key reason that enterprises seek outside financing is to develop their operations.- According to the autumn SME Barometer Survey, interest in obtaining internationalisation financing has dropped in all sectors, while, on the other hand, strongly growth-oriented enterprises show a clear desire to expand by internationalising. Right now, the most important thing is to line up needs and offerings and make sure that not a single profitable project falls outside our network of Team Finland organisations, says Finnvera CEO Pauli Heikkilä.The Federation of Finnish Enterprises, Finnvera and the Ministry of Employment and the Economy jointly conduct the SME Barometer Survey twice a year. The aim is to examine the operations and economic operating environment of small and medium-sized enterprises. The autumn 2015 Barometer Survey is based on the responses submitted by more than 6,500 SMEs.

News
28.08.2015
Team Finland boosts its services to entrepreneurs

The Team Finland network is developing its domestic services. The aim is to simplify companies' access to the network's services and to improve the smoothness of service. Prime Minister Juha Sipilä has today appointed a new Steering Group for the network, with Mr. Risto Siilasmaa as Vice Chairman.Team Finland network is developing its domestic services. Thanks to the new service model, the network organizations can now serve companies in an unbroken chain, without referring them from one organization to another. The first changes visible to Finnish companies are one common telephone service number and an online contact form. The new services were introduced on Thursday, August 27, 2015."The idea underlying Team Finland's new domestic service model is simple: a company gets all the services it needs from a single service point. In other words, the company does not need to learn the division of tasks between public organizations in order to obtain the services they provide. Instead of dallying over complex administrative structures, we must direct our attention towards conquering new markets and building new growth. This calls for a Finnish team spirit – which is exactly what Team Finland is all about," says Mr. Olli Rehn, Minister of Economic Affairs.Service is improved by more focused customer service and tighter cooperation between the organisations in managing customer relationship. Each customer company will get a service team which, according to the customer's needs, combines the expertise of different organizations. The team makes a service proposal for the customer and takes care of the customer's changing needs. Regional activities are carried out in cooperation with local actors, including regional development agencies, chambers of commerce and the Federation of Finnish Enterprises. Due to the new service model, the entrepreneur need not know the details about the services provided by different organisations."There is a demand for Finnish expertise worldwide. The duty of the State is to ensure that the operating environment for companies is good. Well-functioning internationalization services are an integral element in this," Ms. Lenita Toivakka, Minister for Foreign Trade and Development, points out.Prime Minister Juha Sipilä has appointed Risto Siilasmaa, Chairman of the Board of Nokia Corporation and F-Secure Corporation, to act as Vice Chairman of the Team Finland Steering Group. Prime Minister Sipilä himself serves as Chairman of the Steering Group. The following persons were appointed as members of the Steering Group: Ilkka Kivimäki, Partner, Inventure Oy; Nina Kopola, President and CEO, Suominen Corporation; Päivi Leiwo, Chairman of the Board, Oilon Oy; Paula Salastie, CEO, Teknos Group Oy; Paula Lehtomäki, State Secretary, Prime Minister's Office; Peter Stenlund, Secretary of State, Ministry for Foreign Affairs; Jari Gustafsson, Permanent Secretary, Ministry of Employment and the Economy (as of October 1, 2015); and Anita Lehikoinen, Permanent Secretary, Ministry of Education and Culture."We will continue developing the Team Finland network in line with the Government Programme. We want to help even more new, internationally competitive companies to reach the global markets. At the same time, we will steer the internationalization service providers to ever closer cooperation," states Prime Minister Juha Sipilä.The Steering Group is appointed for the duration of Government's term, it is responsible for target setting and the strategic steering of the network. Its composition ensures good interaction between the business world and government.Team Finland network brings together all government-funded players providing internationalisation services for companies, working to attract foreign direct investments to Finland, and promoting Finland's country brand. The core of the network comprises of the Ministry of Employment and the Economy, the Ministry for Foreign Affairs, the Ministry of Education and Culture, and the publicly funded organisations under their supervision that offer internationalisation services.Team Finland's common telephone service number is +358 295 020 510. The contact form for the companies is available at https://www.tekes.fi/team-finland-yhteydenotto/More information Anna-Kaisa Heikkinen, Special Adviser to the Prime Minister (International Affairs), tel. +358 40 7483 867, Prime Minister's Office; Jannika Ranta, Special Adviser to the Minister of Economic Affairs, tel. +358 29 504 7165, Ministry of Employment and the Economy; Marja Koskela, Diplomatic Adviser to the Minister for Foreign Trade and Development, tel. +358 295 350 633, Ministry for Foreign Affairs. Requests for interviews of Risto Siilasmaa, Vice Chairman of the Team Finland Steering Group, please contact Mari-Kaisa Brander, Communications Manager, tel. +358 40 131 3388, Prime Minister's Office.

Press Releases
13.08.2015
The Finnvera Group’s Interim Report for January-June 2015

An eventful start of the year for FinnveraFinnvera’s mandates and tasks have expanded on several occasions during last year and the current year. In the period under review, it became possible for Finnvera to guarantee the refinancing of export credits granted by banks. This arrangement promotes the acquisition of funds for financing exports.A new guarantee, known as the Start Guarantee, was taken into use in April. It is intended for the financing of starting enterprises that have been in business for no more than three years. Demand for the guarantee, which is given for a loan granted by a bank, has been brisk. Within three months, over 400 enterprises have been granted these guarantees, for a total sum of almost EUR 20 million. Improvements to the provision of financing have been implemented in all enterprise size categories. Since the beginning of this year, when certain conditions are met, Finnvera has been able to provide a growth enterprise a loan of at most EUR 2 million without collateral in order to finance growth.In line with the Government Programme public actors are still given the task of offsetting shortcomings that exist in enterprise financing on the commercial market. During the summer and early autumn, Finnvera will work under the Ministry of Employment and the Economy to prepare new measures for implementing the Government Programme.Business operations and the financial trendDuring the first half of the year, the volume of export credit guarantee offers given by Finnvera was over four times greater than in the first six months of 2014. As concerns financing offers for export credits, the figure was nearly three times greater. The volume of loans and guarantees granted to SMEs and enterprises larger than the SME definition applied by the EU was 34 per cent greater than the year before.The Finnvera Group’s profit for January–June came to EUR 55 million (34 million). This was EUR 20 million more than for the first six months of 2014. The main factors improving the financial performance were the decreases in impairment losses on receivables and guarantee losses, as well as the increase in the fee and commission income of the parent company, Finnvera plc.The profit of the parent company, Finnvera plc, stood at EUR 56 million (40 million). The Group companies and associated companies had an effect of EUR -1 million on the profit (-5 million). Venture capital investments accounted for EUR -6 million of this effect (-7 million). Interest equalisation and the financing of export credits by Finnish Export Credit Ltd accounted for EUR 5 million (1 million).The parent company’s export financing and SME financing showed a profit: the separate result for export credit guarantees and special guarantees came to EUR 46 million (31 million), while the profit for loans and guarantees in SME financing was EUR 10 million (4 million).In accordance with IAS 8 standard, an adjustment affecting the previous financial periods has been made in the Finnvera Group’s financial statements for January–June 2015. Owing to a system error in the accrual of income from export credit guarantees and expenses from reinsurance, the sums recognised on the income statement had been too small. Correspondingly, the sums for guarantee premiums and reinsurance premiums paid in advance and shown on the balance sheet had been too large. The adjustment had an effect of EUR 53 million on the equity attributable to the parent company on the balance sheet as per 31 December 2014 and 30 June 2015. The effect on the net value of fee and commission income and expenses for the reference period 1 January–30 June 2014 was EUR 43 thousand (Notes to the accounts 1).ezembedOutlook for demand for financingDuring the first half of 2015, demand for Finnvera’s SME financing was considerably livelier than it was a year ago. The value of the applications increased by 44 per cent. Above all, the growth was attributable to Finnvera’s wider mandates, such as the possibility to finance enterprises larger than SMEs and to subscribe bonds. The SME financing volume is also expected to remain on high level during the latter half of the year.Individual large projects increased the demand for export financing, which was more than triple the figure for the corresponding period the year before. Demand for export credit guarantees is expected to remain brisk in Finland. However, the worldwide demand for guarantees has shown signs of decline in many countries because banks have increasingly often started once again to provide financing for large export transactions and, on the other hand, because investments have been falling, especially in the energy sector.CEO Pauli Heikkilä:'“For us, the first six months of the year were busy as concerns both demand for financing and the granting of financing. Thanks to our ever wider range of financing opportunities, we were able to participate in many financial arrangements. For instance, we completed our first bond subscription during the period under review. Our anchor role ensured that financing could be arranged for the total investment of over 100 million euros by Kotkamills. We are also participating in the financial arrangements for the bioproduct mill to be constructed in Äänekoski by Metsä Group. To facilitate equipment purchases from Finland, we provide guarantees for about half, or 400 million euros, of the debt needed for the project. Apart from Finnvera, six commercial banks, the Swedish Export Credits Guarantee Board (EKN) and the European Investment Bank are participating in the arrangements.”Additional information:Pauli Heikkilä, CEO, tel. +358 29 460 2400Ulla Hagman, Senior Vice President, Finance and IT, tel. +358 29 460 2458Interim Report for January-June 2015 (PDF)

Press Releases
08.06.2015
Finnvera involved in a major forest industry investment

Finnvera is participating in the financial arrangements for the world’s first bioproduct mill, to be constructed by Metsä Group in Äänekoski, Finland. Valued at EUR 1.2 billion, the investment project is the largest ever carried out by the forest industry in Finland.To facilitate equipment purchases from Finland, Finnvera provides guarantees for about half, or EUR 400 million, of the debt needed for the project. Apart from Finnvera, six commercial banks, the Swedish Export Credits Guarantee Board (EKN) and the European Investment Bank are also participating in the financial arrangements.Last summer Finnvera was authorised to offer export credit guarantees for financing investments that are made in Finland and generate, or otherwise benefit, exports. Previously, export credit guarantees could only be used to facilitate financial arrangements for transactions abroad and to meet exporters’ needs for working capital and performance bonds. Another objective of the legislative amendment was to balance the competitive standing of Finnish equipment suppliers vis-à-vis their foreign counterparts.“Metsä Group’s investment satisfies the criteria defined for our new mandate, and we were able to participate in the project financing with our export credit guarantee. The project will have a positive impact on Finnish exports, as it is expected to boost exports by EUR 0.5 billion annually. The investment also has substantial effects on employment,” says Executive Vice President Topi Vesteri, who is responsible for export financing in Finnvera.“Our project is based on a careful overall assessment of the profitability of the pulp business and the long-term market situation. Financing is a central element of the whole project, and the fact that both Finnvera and the State of Finland are participating in sharing the financing risk significantly reduced the limit load of commercial banks. The loan guaranteed by Finnvera is an important component of overall financing. Conforming to the OECD terms, the loan has sufficiently long maturity and in general offers competitive terms. Finnvera plays one of the key roles in the financing package,” says Kari Jordan, President and CEO of Metsä Group.According to Jordan, the goal in equipment purchases was to ensure that the technology, delivery reliability and commercial terms were the best available. It is positive that the leading technology suppliers for the pulp industry are companies operating in Finland. For its part, the amendment made to the Act on the State’s Export Credit Guarantees enabled the high percentage of domestic equipment deliveries.“It is important that Finland has a competitive organisation promoting exports and an operating model that levels the playing field between companies operating in Finland and their competitors. Here Finnvera is doing good work, and the amendment made to the Act on the State’s Export Credit Guarantees in 2014 is an example of dynamic development to secure the prerequisites for exports,” says Kari Jordan.Construction of the mill has begun. It is scheduled to be in operation by the end of 2017.Additional information:Topi Vesteri, Executive Vice President, tel. +358 29 460 2676Image: Metsä Group

Press Releases
29.04.2015
The Finnvera Group's Interim Report for January-March 2015

Demand for financing revived despite uncertaintyFrom the perspective of the economy, the first quarter of 2015 was varied. Despite unstable and negative economic outlook, the weakening of the euro brought a little light to export enterprises. SME financing was sought actively, and Finnvera strove to meet enterprises’ expectations through its wider range of financing possibilities. The great majority of enterprises can obtain financing for profitable projects even though banks have introduced more stringent requirements for loans and collateral. Thanks to some major individual projects, the total demand for export credit guarantees, expressed in euros, was many times greater than during the same period a year ago. Finnvera’s risks pertaining to Russia have increased. The company continues to grant export credit guarantees for Finnish exporters’ projects in Russia, but the Russian counterparty's credit standing is examined increasingly carefully. The exposure trend and repayment times are monitored.Business operations and the financial trendIn January–March, the value of offers given by Finnvera for export transactions was over three times greater than the year before. Loans and guarantees granted to SMEs and – by virtue of the authorisation received by Finnvera at the start of 2015 – to enterprises larger than the EU’s definition of an SME increased by over 40 per cent on the figure for the previous year.The Finnvera Group’s financial performance in January–March came to EUR 26 million, or EUR 19 million more than during the corresponding period the year before (8 million). The main factors improving the performance were the decrease in impairment losses on receivables and in guarantee losses, as well as profits on items carried at fair value. The profit of the parent company, Finnvera plc, stood at EUR 26 million (10 million). The subsidiaries and associated companies had an impact of EUR 1 million on the Group’s profit (-3 million). Venture capital investments accounted for EUR -0.5 million (-3.3 million) of this impact. Interest equalisation and financing of export credits by Finnish Export Credit Ltd accounted for EUR 1.1 million (0.7 million).The parent company’s export financing and SME financing showed a profit: the separate result for export credit guarantees and special guarantees came to EUR 24 million (5 million) while the profit for credits and guarantees in SME financing was EUR 0.3 million (5 million). The parent company’s result included a surplus of EUR 2 million (0.2 million) from export credit financing.The Group’s key figures on 31 March 2015 (31 December 2014)•    Equity ratio                      13.9% (14.4%)         •    Capital adequacy, Tier 2     18.1% (18.6%)     •    Cost-income ratio              24.1% (25.7%)    Outlook for financingDuring the first quarter of 2015, demand for Finnvera’s SME financing was livelier than during the same period a year ago. The total sum of applications for financing increased by nearly 50 per cent. The deal flow in financing for growth and internationalisation is likely to remain good, and some signs of recovery are also visible in the subcontracting chains of large enterprises. However, most of the demand for SME financing still focuses on working capital; this would indicate that the investment level will remain low. Demand for export financing is rising when compared to the previous year. Owing to ownership arrangements in the shipyard industry, demand for ship financing will increase. Another consideration contributing to the higher demand for export credit guarantees is the fact that Finnvera can now provide financing for large enterprises’ domestic projects targeted at exports. Demand for guarantees to finance transactions in Russia has been very brisk in early 2015 despite the fact that Finnish exports to Russia have shrunk. Finnvera estimates that the Russian share of the total exposure will not increase.CEO Pauli Heikkilä:“The international market has improved although the prospects for the Finnish economy are unclear. Finnvera’s financing possibilities have been expanded in various ways. For instance, Finnvera can now subscribe bonds, finance domestic investments benefiting exports, and provide financing for larger enterprises than before. An indication of this was that demand for financing during the first quarter clearly exceeded the figure for the year before. A welcome feature was that, after a long time, enterprises also sought financing for some fairly large investments, although most of the demand still focused on working capital needs. In the challenging financial situation, banks require more self-financing from enterprises, which may make it more difficult for enterprises to obtain financing. It would therefore be important to strengthen the equity of Finnish enterprises.”Additional information:Pauli Heikkilä, CEO, tel. +358 29 460 2400Ulla Hagman, Senior Vice President, Finance and IT, tel. +358 29 460 2458Interim report Q1 2015 (PDF)

News
24.04.2015
Finnvera’s Refinancing Guarantee facilitates financing arrangements for exports

It is now possible for Finnvera to guarantee the refinancing of export credits granted by banks to buyers. The arrangement promotes the acquisition of funds for financing exports. The change in Export Guarantee Act will enter into force on 1 May 2015.The Refinancing Guarantee is a separate guarantee used to arrange financing for export trade. Its purpose is to facilitate the funding of export credits granted to buyers. Finnvera can grant the guarantee, for instance, to an institutional investor that refinances an export credit given by a bank. The guarantee can also be utilised in the financing of domestic investments that benefit exports. In most cases, the guarantee is associated with one export credit, but it can also be used in a situation where the bank refinances several export credits.“The adoption of the new guarantee stimulates the operations of the financial market and the private financing of exports. It allows banks to finance some of their export and ship credits by acquiring the necessary funds from the market with the help of the Refinancing Guarantee. The guarantee arrangement also reduces our own need for funding,” CEO Pauli Heikkilä says.The guarantee helps to develop the Finnish export financing system further, increasing its competitiveness. Similar arrangements are already in use in many of our reference countries, such as Germany, Denmark and the Netherlands.Additional information: Pauli Heikkilä, Chief Executive Officer, tel. +358 29 460 2400

News
23.04.2015
Export credit guarantees protect Finnish enterprises against risks in Russia

Russia’s economic situation creates uncertainty for Finnish enterprises’ exports to Russia. Demand for Finnvera’s export credit guarantees for business in Russia increased in early 2015.Russian banks and enterprises do not currently have the same access to financing on the international market as before, and enterprises’ capacity to meet their financial obligations has weakened. Higher credit loss risks also hinder Finnish enterprises’ exports to Russia According to Finnvera, Finnish export enterprises’ demand for export credit guarantees for Russia has increased in early 2015.Raisioagro Ltd, a Finnish manufacturer of animal feeds, has exported its products to Russia since the 1990s and has used Finnvera’s credit insurance since the early 2000s.Sales Director Erik Norrgård of Raisioagro explains that successful trading in Russia requires, in particular, trust between the seller and the buyer. Personal relations are very important. Thanks to its long experience, Raisioagro has managed to find reliable and well-established partners in Russia, but the company also has experience of situations where the buyer has not paid as agreed.“In the first case, payments were made as agreed for a fairly long time, but when the volumes of goods increased, payment transactions ceased. This was followed by long explanations and promises and, in the end, the buyer’s bankruptcy. In the second case, the company’s excessive growth depleted the company’s liquidity. The management changed and the end result was the same: payments ceased and the company went bankrupt,” Norrgård says.When the buyers’ insolvency became evident, Finnvera’s export credit guarantees eased Raisioagro’s situation. On the basis of the guarantees, Raisioagro was paid compensation for the sales receivables it did not repatriate.Creditworthiness of Russian enterprises under closer scrutinyAccording to Finnvera’s Claims Adviser Tarja Junno, Finnvera received about 30 claims for compensation in 2014. In the current year, the figure so far is about ten. At present, most of the claims are associated with Russian buyers.“As a rule, the reason behind a claim is the buyer’s insolvency or reluctance to pay. Often the exporter has said that the reason for the buyer’s default on payments is Russia’s economic situation,” Junno says.Eeva-Maija Pietikäinen, Team Leader, Finance, at Finnvera, says that, for an enterprise engaged in foreign trade, consideration of buyer risks and the buyer’s solvency is part of risk management. In the case of weak buyers, advance payments or otherwise secure payment terms are recommended.“If payment time is granted, insuring credit risks is part of risk management. In other words, it can be compared to property insurance. Unprotected risks may become fatal for the enterprise’s cash flow and profitability,” Pietikäinen cautions.Finnvera has tightened its guarantee policy vis-à-vis Russia, and the exposure trend and repayment times of transactions with Russian partners will be monitored closely. Export credit guarantees continue to be granted, but Finnvera will thoroughly investigate Russian buyers’ creditworthiness and will pay particular attention to buyers’ capacity to withstand fluctuations in the exchange rate of the rouble and in interest rates.In addition, Finnvera checks that the buyer companies and their owners are not on the list of EU sanctions. Exporters are requested to provide assurance that the products exported are not under export restrictions and that the necessary export permits are in order.Differences in corporate culture and legislation create challengesAccording to Erik Norrgård, exports to Russia are complicated by the Russian corporate culture, where it is very difficult to obtain access to companies’ managers. In addition, the rapid growth and indebtedness of companies pose risks to commerce. Norrgård characterises Russian legislation as challenging.“Information is splintered and, for instance, different customs districts may apply differing practices. It may also be difficult to obtain accurate information about the buyer company’s actual situation, since especially smaller undertakings are not necessarily used to being asked to show their financial statements,” Norrgård says.Despite the challenging economic situation in Russia, Raisioagro plans to increase its sales there. More than before, however, the company will make use of its familiar contacts and will focus on existing agreements.Norrgård recommends that enterprises planning exports to Russia take out guarantees. It is also advisable to prepare thoroughly for the initial investigation and for any barriers to sales that might exist. Norrgård says that restrictions posed by the customs and other authorities often come unexpectedly and at a short notice.“It’s good to be prepared for the fact that, in particular, buyers associated with primary production do not necessarily buy anything without some sort of a limit. The risk must always be weighed case-by-case. The Russians are a proud people, and it is good for neighbours across the border to recognise these realities for commerce. Especially in these times, Finnvera and other additional assistance are needed in exports to Russia.”Export credit guarantee: By using export credit guarantees, exporters and providers of financing for exports can protect themselves against credit losses that may arise when a foreign customer is granted payment time. If needed, it is also easier to arrange financing to a foreign customer for purchasing the export product when Finnvera covers the credit risk. Finnvera grants guarantees for countries with sufficient credit standing and assesses the creditworthiness of buyers and guarantors. The risks covered by export credit guarantees can be commercial, such as bankruptcy or reluctance to pay, or political, i.e. associated with the buyer’s country. Apart from the receivables, the guarantees also cover costs arising from recovery. Claims for compensation are submitted in writing, either as a free-form application or on the claims form provided by Finnvera. Once the application has arrived , Finnvera starts the claims process to determine whether the general guarantee terms and the terms of the guarantee agreement, such as the prescribed times for filing the claim and the completion of export declarations, have been met.

Press Releases
10.04.2015
Harri Sailas and Antti Zitting elected to Finnvera Board

On 9 April 2015, Finnvera’s Annual General Meeting elected new members to the company’s Supervisory Board and Board of Directors.Composition of the Supervisory BoardThe new members on the Supervisory Board are Mika Harjunen, Information Security Manager; Ann-Louise Laaksonen, Vice Chair; Veli-Matti Mattila, Chief Economist; Hanna Sarkkinen, M.A; and, Senior Adviser, Financing.Johannes Koskinen, Member of Parliament, will continue as Chairman of the Supervisory Board, and Lauri Heikkilä, Member of Parliament, as Vice Chairman. Paula Aikio-Tallgren, Entrepreneur; Eeva-Johanna Eloranta, Member of Parliament; Lasse Hautala, Member of Parliament; Olli Koski, Chief Economist; Leila Kurki, Employment Policy Expert; Esko Kurvinen, Member of Parliament; Anna Lavikkala, Labour Market Director; Lea Mäkipää, Member of Parliament; Antti Rantakangas, Member of Parliament; Osmo Soininvaara, Member of Parliament; and Sofia Vikman, Member of Parliament, will continue as members of the Supervisory Board.Composition of the Board of DirectorsThe new members on the Board of Directors are Harri Sailas, B.Sc (Econ.), and Antti Zitting, Chairman of the Board.Markku Pohjola, B.Sc (Econ.), will continue as Chairman: Pekka Timonen, Director General, as First Vice Chair; and Marianna Uotinen, Specialist Counsel, as Second Vice Chair of Finnvera's Board of Directors. Kirsi Komi, LL.M.; and Pirkko Rantanen-Kervinen, B.Sc (Econ.) will continue as Board members.Financial Statements 2014 and distribution of profitsThe Annual General Meeting adopted the Consolidated Financial Statements and the Parent Company’s Financial Statements (link) for the period 1 January–31 December 2014, discharged the Supervisory Board, the Board of Directors and the Chief Executive Officer from liability, and approved the proposal made by the Board of Directors for the use of the parent company’s profits.Election of the auditorKPMG Oy Ab was re-elected Finnvera’s regular auditor with Juha-Pekka Mylén, Authorised Public Accountant, as the principal auditor.Further information:Pauli Heikkilä, CEO, tel. +358 (0)29 460 2400Risto Huopaniemi, Senior Vice President, Administration, tel. +358 (0)29 460 2520

Press Releases
25.03.2015
Finnvera continues to grant export credit guarantees for exports to Russia – the exposure trend is being monitored

Finnvera grants export credit guarantees for Finnish exporters’ transactions in Russia. The exposure trend and repayment times are monitored closely.The country classification determined by the OECD member countries for Russia has been downgraded from 3/7 to 4/7. The country classification is based on an assessment of the country’s economic situation and ability to meet its financial obligations. A downgraded country class raises export companies’ guarantee premiums. Risks in export credit guarantee operations have increased, for instance, because it has become more difficult for Russian banks and enterprises to obtain financing from international markets.Finnvera will continue to grant export credit guarantees for exports to Russia, but the Russian counterparty's credit standing is examined increasingly carefully. Before a guarantee decision is made, it is ensured that financing has been arranged for the exports, the bank providing the financing is known, and the current sanctions do not restrict the arrangement of financing or the granting of the guarantee. As part of risk management, Finnvera will monitor the development of outstanding commitments. At the end of 2014, Russia accounted for 7 per cent of all outstanding commitments. Demand for export credit guarantees for transactions in Russia increased in early 2015. The trend in Finnvera’s exposure vis-à-vis Russia will also be taken into account in the overall assessment of large projects worth several tens of millions euros.“Finnvera monitors the exposure trend and the repayment times of credits. Since a large share of the current commitments for Russia will be paid back within the next few years, there will constantly be room for new commitments,” says Pauli Heikkilä, CEO of Finnvera.Additional information: Pauli Heikkilä, Chief Executive Officer, tel. +358 29 460 2400Topi Vesteri, Executive Vice President, tel. +358 29 460 2676

Press Releases
27.02.2015
Financial Statements of the Finnvera Group for the fourth quarter and 1 January–31 December 2014

Finnvera’s possibilities to provide financing improved markedlyThe Finnish financial market was marked by diffuse economic prospects and the effects of tightening bank regulation, which were felt, in particular, in the credit terms and credit margins of the weakest borrowers. Demand for financing focused heavily on working capital, and there were very few investment projects. The government greatly improved Finnvera’s possibilities to provide public financing.The Group’s financial trend The Finnvera Group’s profit for the year 2014 was EUR 101 million, or 27 million euros more than the year before (75 million). The main factor improving the performance was the decrease of 47 per cent in impairment losses on receivables and in guarantee losses, totalling EUR 34 million (64 million). In addition, financial performance was improved by the reduction of administrative expenses by 5 per cent, to EUR 41 million (43 million) and the increase of 3 per cent in the net value of fee and commission income and expenses, totalling EUR 138 million (134 million). Correspondingly, the performance was encumbered, among other factors, by the lower net interest income, EUR 52 million (56 million), due to a fall in interest levels and in the amount of outstanding credits in SME financing. Moreover, losses on venture capital investments and on the recognition of derivatives and liabilities at fair value totalled EUR 10 million (2 million). The financial performance of the parent company, Finnvera plc, in 2014 came to EUR 94 million (69 million).The Group’s operating profit amounted to EUR 102 million (75 million) and was broken down as follows: EUR 6 million for SME financing (7 million) and EUR 104 million for export financing (74 million). The operating profit from venture capital investments was EUR 7 million in the red (5 million).The Finnvera Group’s profit for the last quarter of 2014 was EUR 25 million, or clearly less than for the third quarter (42 million). The main factors affecting the smaller profit were the impairment losses on receivables and guarantee losses, which nearly doubled and were EUR 19 million more than in the third quarter.Within the past few years, Finnvera’s outstanding commitments and their risk levels have risen significantly. However, in 2014 the outstanding commitments for SME financing fell and the risk level did not rise any longer. The outstanding commitments for export financing increased in 2014 but, as in the case of SME financing, the risk level did not rise. Nevertheless, the risk levels are still high, as evidenced by the considerable impairment losses and guarantee losses in SME financing in recent years, even though the impairment losses on receivables and guarantee losses in 2014 were below the figures for 2013. In export financing, no major losses have been recorded in recent years or in 2014. The estimated provisions for losses in export financing were reduced in 2014 when compared against the provisions for losses in the financial statements for 2013.The extent and risk level of Finnvera’s outstanding commitments will have a significant impact on its financial performance and long-term economic self-sustainability in the coming years. In examining the financial performance, it is important to note that, at the end of December 2014, Finnvera’s total commitments for export credit guarantees and special guarantees amounted to EUR 12.6 billion and the commitments for credits and guarantees in SME financing, as well as guarantee receivables, stood at EUR 2.4 billion. Seen against these commitments, the net profit building a loss buffer on the balance sheet is now about 0.7 per cent at the annual level and the equity 6 per cent.The group’s key figures on 31 December 2014 (31 December 2013) Capital adequacy, Tier2 18.6% (16.9) Cost/income ratio 25.7% (27.0) Equity ratio 14.4% (18.4) Outlook for financingThe U.S. economy has got a foothold on the growth path, but economic growth in the euro area is stagnating. In Russia, the sanctions focusing on the country’s economy, the falling oil prices and the change in the political direction caused financial difficulties for the country in late 2014. The situation will affect the demand for Finnvera’s export financing and the company’s risk position in an essential way if the current uncertain political and financial situation continues. Finnvera’s financing plays an increasingly central role in the conclusion of export transactions. Despite this, it is expected that the demand for export financing will decrease further from the previous year, as uncertainty keeps the volume of investments small. Finnvera’s possibilities to provide financing for large enterprises’ domestic projects intended for exports will become concrete when Finnvera can participate in investment projects undertaken by the export industry in Finland.The slow economic growth and the low investment level will keep the demand for SME financing moderate in 2015. However, according to Finnvera’s estimate, the new mandates received by the company and, for its part, the regulation of banks may increase the overall level of demand. Most financing needs are still associated with working capital.The uncertainty of the economy makes it difficult to predict financial performance. The materialisation of large individual export credit guarantee claims may considerably weaken the projected situation. According to the current estimate, the Finnvera Group’s financial performance for 2015 is likely to be somewhat weaker than that for 2014.CEO Pauli Heikkilä:“The government greatly improved Finnvera’s possibilities to provide public financing. Thanks to the amendments made to legislation and commitments, we can increase our risk-taking in both SME financing and export financing. Financing through bonds, guaranteeing large enterprises’ domestic investments relating to exports, and the possibility to provide financing for enterprises larger than the SME definition applied by the EU, diversified our selection of means. Once the bill on the refinancing guarantee is passed, we can state that, in terms of authorisations and financial instruments, we are on the same level as our principal reference countries, such as Sweden and Germany.One of our goals is to identify growth companies and encourage them to grow internationally. With respect to enterprises operating on the domestic market, our principle is to share risks so that a bank or some other private provider of financing, such as an insurance company, is the principal source of financing. In particular, we focus our financing on situations of change within companies and on the financing needed by start-up enterprises during establishment. We continue our efforts to ensure that our financing has the maximum impact and is allocated to the most important uses in view of industrial policy.Financial Statements 2014 (PDF)Statement on the Corporate Governance and Steering System 2014 (PDF)Additional information:Pauli Heikkilä, Chief Executive Officer, tel. +358 29 460 2400Ulla Hagman, Senior Vice President, Finances and IT, tel. +358 29 460 2458DISTRIBUTIONNASDAQ OMX Helsinki OyOslo Børs ASALondon Stock ExchangeThe principal mediawww.finnvera.fiFinnvera publishes its Annual Report for 2014 as an electronic document on the company’s website in the week 11 in Finnish, English and as a summary in Swedish. The Annual Report also includes the Corporate Responsibility Report.

News
23.02.2015
Breaking into the South American drilling market with the help of Team Finland LetsGrow

Arctic Drilling Company is looking for new markets in Chile. To accelerate its internationalisation process, the company has participated to the Team Finland LetsGrow financing programme.Founded in 2004, Arctic Drilling Company (ADC) provides drilling services, such as sampling and measuring, and develops machinery for surface and underground drilling. The company's products and services are mostly used in mineral exploration. ADC's customers include some of the largest mining companies in the world, such as LKAB, Anglo-American, Agnico-Eagle and FQM. The company's factory is located in Rovaniemi, Finland.ADC employs almost 80 people, and its turnover has been growing steadily; last year the company's turnover was approximately EUR 10 million. The company's primary markets for drilling services are the Nordic countries."Competition in the Nordic countries is fierce, as the volume of work and prices have dropped in the last two years. Chile is a rapidly growing market area at the moment", explains Aleksi Autti, ADC's Head of Exports."We are looking to grow through export trade. Our main goal is to secure a share of the Chilean market, make our operating model better suited to the international domain and invest in the manufacture and sales of drilling machinery in specific markets. LetsGrow seemed well suited for these purposes."The Team Finland LetsGrow financing programme is based on the premise that Finnvera grants an unsecured loan, Tekes provides grant for innovation services and Finpro provides advice on growth and internationalisation.According to Autti, the LetsGrow funding and advice bundle is an important tool for businesses that are looking to invest in growth. Businesses are more likely to apply for funding if they can get a comprehensive financing service for promoting export trade from the same source.ADC strives to stand out from the competition by investing in next-generation drilling machinery. The machines are automated and move independently, which makes them safer and more efficient than conventional drilling machines. ADC invests in quality, environmental friendliness and safety, which is evidenced by the company's ISO9001, ISO14001 and OHSAS18001 certification. Arctic Drilling Company is the first Nordic company in its field to be given these certificates."In five years' time, ADC will be operating not just in the Nordic countries but also in at least three other market areas on a permanent basis, and the company will be one of the biggest employers in Rovaniemi."Text: Kaj Nordgren, TekesPhoto: Arctic Drilling Company

Press Releases
10.02.2015
Eager to internationalise – the availability of financing isn’t an obstacle

SMEs are planning to apply for internationalisation financing despite the record weak economic outlook. The availability of financing is considered to be good.Economic expectations have undergone a major change compared against the survey done last autumn. The balance figure is negative for the first time since 2009, and 28 per cent of the respondents assessed that the downward trend of the economy will continue for the next 12 months.From the perspective of financing, a positive feature in this spring’s SME Barometer Survey is that enterprises are willing to apply for internationalisation financing. Plans to apply for financing have risen in all sectors. Aside from the internationalisation expectations, the willingness to grow is also reasonably good despite economic uncertainty: seven per cent of enterprises say that they have a strong desire to grow and 35 per cent plan to grow according to their possibilities.SMEs perceive that providers of financing have set stricter requirements for collateral and expect companies to provide larger shares of self-financing. In general, however, financing is not seen as a problem, and over 80 per cent of the respondents say that the availability of financing has not affected the implementation of projects.“Last year, enterprises fell short of their growth targets mainly because of weak demand and stiffer competition. The business cycles may be unfavourable, but the markets still exist, and the winners on the markets are those who develop their competitiveness. Growth enterprises now need all possible support to gain a foothold on international markets. This is where we want to make an impact through financing, in cooperation with the other Team Finland organisations,” says CEO Pauli Heikkilä of Finnvera.Improved financing options for FinnveraDemand for outside financing will decline slightly during the next 12 months. Companies are cautious about investments and seek financing mainly for working capital.Finnvera’s possibilities to finance different-sized enterprises improved markedly at the start of the current year. Finnvera’s range of tools is now considerably wider than before, especially in terms of encouraging investments and financing growth.“We can now also finance enterprises larger than SMEs. On the other hand, small enterprises will be able to get loans of up to 50,000 euros directly from Finnvera. When business is profitable, we are increasingly better equipped to contribute to financing growth,” Heikkilä says.The Federation of Finnish Enterprises, Finnvera and the Ministry of Employment and the Economy jointly conduct an SME Barometer Survey twice a year. The goal is to study the operations and economic environment of small and medium-sized enterprises. The barometer for spring 2015 is based on responses from over 4,400 SMEs.Hela SMF-barometer (på finska)Arbets och näringsministeriet: Konjunkturbilden för tillväxtorienterade SMF-företag positivare än för andraAdditional information:Pauli Heikkilä, Chief Executive Officer, tel. +358 29 460 2400Jonna Myllykangas, Communications Officer, tel. +358 29 460 2740Finnvera provides financing for the start, growth and internationalisation of enterprises and for protection against export risks. We strengthen the operating potential and competitiveness of Finnish enterprises by providing loans, domestic guarantees, venture capital investments and export financing services. The risks involved in financing are shared between Finnvera and other providers of financing. Finnvera is a specialised financing company owned by the State of Finland. It has official Export Credit Agency (ECA) status.

News
30.01.2015
Finnvera will be able to provide short-term export credit guarantees for exports to Greece until 30 June 2015

Based on its own risk assessments, Finnvera may continue to provide short-term export credit guarantees for exports to Greece until 30 June 2015. The special status of Greece among the EU Member States is based on the decision of the EU Commission to continue to exclude Greece from the list of countries for which Finnvera cannot provide short-term export credit guarantees (risk period less than two years) in a normal market situation. The Commission decision will remain in effect until 30 June 2015.Under the Communication on short-term export credit insurance, which is based on the EU competition legislation and which entered into force in 2013, public credit insurance institutions may not guarantee marketable risks (risks that private insurance companies are prepared to guarantee).According to the Communication, in a normal market situation, Finnvera may not provide guarantees with a risk period of less than two years (manufacturing + credit repayment period) to following countries: EU Member States (Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, United Kingdom) Australia, Canada, Iceland, Japan, New Zealand, Norway, Switzerland, United States of America The EU Commission has also granted Finland an exemption concerning short-term export guarantees to all countries listed above. Read more

News
28.01.2015
2014 – A year of divergent events

Information on Finnvera’s operations in 2014The year 2014 started on a more positive note than the past years, but political crises blurred the outlook again. The cautious and anticipatory atmosphere caused by the general economic situation was reflected in the operations of companies and, through client enterprises, in Finnvera’s operations. Fortunately, the prospects reported by many client enterprises at the turn of the year seemed to have improved again slightly.The Finnish financial markets operated better than some individual opinions would suggest but were still unusually polarised in 2014. In particular, smaller companies reported financing difficulties in cases where the company’s balance sheet structure had weakened. Demand for export financing remained at a high level. Finnvera’s opportunities to provide financing for enterprises were increased through both legal amendments and Government decisions, especially during the latter half of 2014.“Finland needs new businesses and new growth enterprises, and we facilitate the creation of these success stories by using our improved financing opportunities,” says CEO Pauli Heikkilä.Working capital neededIn 2014, Finnvera’s financing for SMEs totalled EUR 1.0 billion, which was about one fifth more than in 2013. Some of this increase was due to the rescheduling of financing granted previously. The bulk of the financing granted, or 49 per cent, was used to finance working capital. Less financing than the year before was needed for company reorganisations and investments. The sectors that received the most financing were industry, services to business, and trade and consumer services.At the end of 2014, outstanding commitments for SME financing totalled EUR 2.8 billion.The volume of offers for export credit guarantees increasedThe volume of guarantee offers given increased by about half on the previous year, to EUR 5.0 billion. The growth was partly explained by the fact that some agreement negotiations associated with exports, which had still been in progress the year before, were brought to a conclusion in 2014.In total, 88 per cent of the guarantees offered concerned the traditional sectors of Finnish capital goods exports, such as shipbuilding, telecommunications and the forest industry. Seen against the previous year, the most rapid growth was recorded in offers given for exports to industrialised countries and Latin American countries. Their combined share was 86 per cent. The largest volumes of guarantees were offered for the United States, Finland and Germany.At the end of 2014, outstanding commitments for export financing totalled EUR 12.2 billion.Additional information:Pauli Heikkilä, Chief Executive Officer, tel. +358 29 460 2400Finnvera publishes the financial statements for the period 1 January to 31 December 2014 on 27 February 2015 and the Annual Report during week 11.

Press Releases
27.01.2015
Finnvera's portfolio companies received EUR 15 million from business angels

Business angel investments are rapidly increasing in Finland. Finnvera's venture capital portfolio companies received a total of EUR 15 million in business angel investments in 2014.The investments made by individuals (business angels) in the portfolio companies of the Seed Fund Vera, which is administered by Finnvera's venture capital investments, increased for a fifth successive year.  In 2014, the fund made a total of EUR 14.3 million in initial and follow-on investments in 72 early-stage companies.  There were a total of 133 companies in the fund's portfolio at the end of last year.  About one third of the portfolio companies also received business angel investments totalling EUR 15 million.  For the first time, the amount of angel investments exceeded the investments made by the fund.Business angels make investments totalling between EUR 40 and 50 million in Finland each year.'In proportion to the annual volume of business angel investments, one can say that Finnvera plays an important role in the channelling of angel financing in early-stage companies,' says Leo Houtsonen, who is responsible for Finnvera's venture capital investments.In euro terms, the business angel investments made in Finnvera's venture capital portfolio companies almost quadrupled between 2009 and 2014. The average size of an investment was about EUR 60,000 and investments were made by a total of 201 business angels.  A total of 253 investments were made during the year. Finnvera will make direct investments in innovative early-stage companies until the end of 2017.Further information: Leo Houtsonen, Finnvera plc, tel.  +358 (0)29 460 2733, leo.houtsonen (at) finnvera.fi

News
27.01.2015
Kasvu Open helps companies' growth dreams come true

The nationwide Kasvu Open 2015 business competition has started. It provides companies with free support and coaching for promoting growth and renewal.Kasvu Open ('Growth Open') is an effective growth-coaching process, in which each participating company has a chance to develop its operations and business idea with experts. In 2015, growth-coaching will be provided on more than 20 regional or sectoral growth paths. A total of 455 companies will be able to join the coaching process and 80 of them will be selected to the Kasvu Open final, which will take place on 22 and 23 October.'Finnvera was also involved in the Kasvu Open process last year as a partner and a provider of coaching. Judging by the feedback received from companies, Kasvu Open provides concrete tools for growth. You rarely have the chance to test your own ideas before such a diverse group of experts. On the other hand, this is also a great opportunity for us at Finnvera to get close to Finnish growth companies,' explains Titta Mantila, Finnvera's Director of Finance.Applications for Start up and Start again series can be submitted until 30 June on the website of Kasvu Open. The Start again series is intended for companies seeking renewal. Companies are supported by a total of 910 experts representing different business sectors, who offer their services for Kasvu Open free of charge.'Kasvu Open provides a comprehensive package of business and financing expertise and the aim is to help your company to succeed,' says Titta Mantila, encouraging enterprises to take part.Finnvera, together with Nordea and Sonera, is the main partner of the Kasvu Open competition.Further information: Uljas Valkeinen, Director of Kasvu Open, tel. +358 (0)50 568 8555http://www.kasvuopen.fi http://www.kasvuopen.fi/osallistu

Press Releases
19.01.2015
Finnvera now in a better position to provide financing for Finnish companies

Changes introduced at the start of 2015 mean better financing opportunities for companies of different sizes, make the financing more effective and improve companies' competitiveness.  Finnvera can now increase its risk-taking, especially in the financing of start-up and growth companies and companies expanding their international operations.Finnvera can grant credits to SMEs that have profitable business operations but that have difficulty getting all the necessary financing from banks.From the start of 2015 Finnvera has also been able to provide financing for larger companies. The changes were introduced because while there is a broad range of public financing options available for Finnish companies meeting the EU criterion of an SME, companies that are only slightly larger have much fewer options.  For example, a growth-oriented company can quickly exceed the limit of 250 employees laid out in the EU definition.  With a new three-year mandate, Finnvera will be able to provide financing for companies that are important for the Finnish economy and that have a turnover of up to EUR 300 million.Moreover, the scope of the Act on the State's Export Credit Guarantees was widened on 1 September 2014. Under the amendment, which applies to investments made in Finland, Finnvera may provide the party making the investment or the suppliers with financing when the investment helps to boost exports.  The new provisions do not involve any upper limit to company size or time limit.Improvements for companies of all sizesIn the future, small companies can get larger credits directly from Finnvera because the amount of micro-financing has been increased from EUR 35,000 to EUR 50,000.  This change also has a major impact on thousands of existing Finnvera customers.As regards larger companies, Finnvera normally shares the financing risks with banks on an equal basis. However in high-impact projects and in the financing of contracts, Finnvera may make a larger financing contribution.  Finnvera can now provide financing with lower amount of collateral than before.  If a company has sufficiently strong financial standing, even collateral-free growth financing is possible.  In investment projects, Finnvera can also provide financing with longer repayment periods than banks.These reforms and the wider financing powers help Finnvera to assist companies to get started, to grow and to expand internationally.– We want to find the companies that would otherwise not find us but which we can help to become more competitive by offering them financing solutions. The new powers will make this much easier.  The reforms have given us tools that organisations doing the same tasks in other countries already have.  In the current economic situation, we want to encourage companies to make investments and to seek new growth. Not a single profitable project should fail because of insufficient financing, says Pauli Heikkilä, Finnvera's CEO.Finnvera has made a favourable financing decision in about 80 per cent of the applications it has received from SMEs. In 2014, SME financing applications totalled 21,677 (+7%) and had a value of EUR 1,408 million (+1%).Further information: CEO Pauli Heikkilä, tel. +358 (0)29 460 2400

News
19.11.2014
Built environment specialist Rapal goes global with Team Finland LetsGrow

The company Rapal seeks strong international growth in several markets. The growth is accelerated through Team Finland LetsGrow finansing programme.Established in the early 1990s, Rapal specialises in consulting services and software for developing working and living environments. The firm, which is wholly staff owned, helps companies develop the working environment to meet changes in working practice, and to save office costs and to draw up reliable infrastructure cost estimates.Modern work is location-independent and current offices are not necessarily designed with this in mind. In the best case scenarios Rapal can achieve a triple win situation. Employees can be free to decide for themselves the best place to do the job, the company can save office costs and the environmental load can be reduced through less commuting and business travel.“Through our software and consulting services Rapal's aim is to verify and assess the impact of developing the working environment in monetary, carbon footprint, employee satisfaction and wellbeing terms,” says CEO Tuomas Kaarlehto.Growth in the United States and Central EuropeRapal is seeking international growth through the Team Finland LetsGrow finansing programme, where Finnvera offers unsecured loans, Tekes provides funding for securing expert services and Finpro advice for internationalizing.“Our cash flow and equity are in good shape. Money has been set aside in our books for capturing new markets. The loan from Finnvera, obtained through the LetsGrow programme, is an excellent way to share the risks involved in internationalisation and provides some financial breathing room, which is especially useful in these economically tough times. The Tekes funding has been used, among other things, for marketing research in Central Europe and China.”Rapal's office is located in Leppävaara in Espoo, and the company has a subsidiary in the US in San Francisco. The group has about 70 employees. Turnover has been steadily rising since the company was established and annual growth stands at around 15 per cent. The company's customer base is made up of government and large corporations in various sectors. The largest client of the California based subsidiary is the biotechnology company Genentech.“The United States is our most important market. It can be really difficult, but it is definitely the most productive. We are also currently looking into the potential in Central Europe, because we believe our products have a clear market there.”www.letsgrow.fiKaj Nordgren, TekesPhoto: Rapal

Press Releases
30.10.2014
The Finnvera Group’s Interim Report for January–September 2014

More tools and authorisations for enterprise financingThanks to legislative amendments and Government decisions, Finnvera has gained important additional authorisations to participate in the financing of projects undertaken by both SMEs and export companies.Finnvera can increase risk-taking in the financing of SMEs because the compensation paid by the State of Finland to Finnvera will cover a greater share of potential losses in Southern Finland as well. In export financing, the statutory ceilings for export credit guarantees and export credits have been raised markedly. The new financing instruments include the option to subscribe to bonds issued by SMEs, the joint Team Finland LetsGrow financing programme of Finnvera, Finpro and Tekes, and the possibility to guarantee domestic investments associated with exports.Russia’s weakened economy and the sanctions and retaliatory sanctions that have stemmed from the Russo-Ukrainian crisis have strained Finnish companies engaged in trade with Russia. The sluggish economy and the low investment level were reflected in the demand for financing.Business operations and the financial trendThe euro sum of the loan and guarantee offers given to SMEs in January–September was slightly higher than during the corresponding period the year before. Many of the offers continued to be associated with working capital or with the rearrangement of financing granted earlier. The amount of offers given for the financing of export trade was almost one third higher than at the same time the year before.The Finnvera Group’s profit for January–September was EUR 76 million. This was 8 per cent more than for the first nine months of 2013 (71 million). The main factors affecting the improved performance were lower administrative expenses than last year, the increase in net interest income and fee and commission income, and decreased guarantee losses and loss provisions in export credit guarantee and special guarantee operations. Underlying the increase of the fee and commission income were some individual major export credit guarantees that came into effect and the general rise in risk premiums on the market. In contrast, the improved performance was weighed down by impairment losses on receivables in SME financing and by losses from venture capital investments, both of which were greater than the year before.The financial performance of export financing and SME financing by the parent company, Finnvera plc, came to EUR 85 million, or EUR 11 million more than during the corresponding period the year before (74 million). Finnvera plc’s profit for export financing was EUR 79 million (63 million) and that for credits and guarantees in SME financing EUR 4 million (11 million).The Group’s key figures on 30 September 2014 Equity ratio 15.9 per cent (19.3 per cent/30 September 2013) Capital adequacy, Tier 2 18.2 per cent (16.9 per cent/30 September 2013) Cost-income ratio 25.3 per cent (25.1 per cent/30 September 2013) Outlook for financingThe economy has started to revive in the United States, but in Europe growth continues to be sluggish. Political turmoil in the Middle East maintains the overall uncertainty. Owing to the dispute between Russia and Ukraine, uncertainty about the financing of transactions to Russia, a market important to Finnish exporters, will continue.Banks are very cautious when funding transactions in Russia, as banks operating in the EU must also consider the existing and anticipated sanctions posed by the United States. In Finland, SMEs and medium-sized enterprises encounter increasing difficulties in financing export trade, as banks are directing their export finance services to projects that are more profitable to banks, which in practice means major companies and their larger transactions.The decision on the ownership of the Turku shipyard, reached in September, and the new orders publicised at the same time, mean that Finnvera’s commitments pertaining to shipbuilding contracts will rise. The authorisation to guarantee debt financing for domestic investments associated with exports, which came into effect at the beginning of September, has aroused much interest among export companies and Finnvera’s financing partners. It seems that this opportunity given to Finnvera to share risks can be a significant boost to decisions concerning new investments, and investments to replace ageing production capacity, within the export industry. The reform may also promote individual infrastructure investments serving the export industry, as well as domestic deliveries of equipment and services for these projects.Finnvera does not expect the demand for SME financing to reach a very high level during the final months of the current year. The factors contributing to this situation include the pessimistic economic outlook, an unusually low investment level and, in part, the regulations posed on banks. Increasingly often, SMEs need financing for working capital.According to the current estimate, the Finnvera Group’s financial performance for 2014 is likely to reach at least the same level as in 2013. A similar estimate made early in 2014 expected the financial performance to fall below that in 2013. The uncertainty factors associated with economic trends and if more risks materialise than has been anticipated, the situation may weaken considerably from what is projected.CEO Pauli Heikkilä:“During the past couple of years, and especially this year, the government has greatly improved Finnvera’s possibilities to provide public financing. Thanks to the amendments made to legislation and commitments, we can increase our risk-taking in both SME financing and export financing. The possibility to subscribe bonds issued by SMEs and to guarantee large enterprises’ domestic investments relating to exports diversified our selection of instruments. It would be essential, as of the beginning of next year, to implement the financing possibility for enterprises larger than the SME definition applied by the EU so that measures such as the possibility to subscribe bonds could be utilised in our enterprise financing. I also hope that the legislative proposal for what are known as refinancing guarantees will be presented before the end of the year. After these changes we can state that, in terms of authorisations and financial instruments, we are on the same level as our principal competitor countries. The consequences of recent events complicate the operations of Finnish companies engaged in exports to Russia.For this reason, the turnover of an SME may have fallen considerably. We can offer financing to strengthen the working capital of SMEs that are encountering difficulties because of the crisis. We also continue to grant export credit guarantees for exports to the Russian market. We comply with the sanctions approved in the EU and we assess our possibilities to participate in projects on a case-by-case basis, in keeping with our normal criteria.Finnvera also continues to provide venture capital investments for innovative start-up enterprises. Owing to the decisions made on the division of tasks between public actors, we shall gradually give up venture capital investments within the next few years.”Interim Report 1 January–30 September 2014 (PDF)Additional information:Pauli Heikkilä, CEO, tel. +358 29 460 2400Ulla Hagman, Senior Vice President, Finances and IT, tel. +358 29 460 2458

News
22.09.2014
SME Export Financing - learning by doing

There is export financing available, but do you know how to take advantage of all the alternatives? Finnvera's SME Export Finance Programme offers information and practical tools for the financing of exports.The programme is aimed at Finnish SMEs engaged in direct exports. Its objective is to familiarise companies with export financing solutions. The programme is also suitable for larger enterprises, which need basic information on export financing."SMEs aren't always familiar with financing and payment solutions involving exports and internationalisation. The right solutions promote negotiations and can be a decisive factor in winning bids. According to the companies that have participated in our programme, the best things they took away from it were the new ideas on financing solutions for concrete export projects," explains Finnvera Senior Adviser Erno Ihto.The free programme is offered in close co-operation with banks operating in Finland. A one-day Export Finance Workshop will be held for each participant enterprise by Finnvera and a bank chosen by the enterprise.  Seminars on export finance will also be held for the programme participants.Enterprises are chosen based on applications. The enterprise chosen for the programme: must have a profitable business; has already concluded its first export deals; and wants to grow by increasing exports.Apply for the autumn programme group by no later than 31 October 2014!Read more on the SME Export Finance Programme page or request additional information from our telephone service at +358 (0)29 460 2580.

Press Releases
09.09.2014
Weak economic situation has not dampened the willingness to grow – financing is still available for growth companies

No change in companies' willingness to expand even though growth expectations have dropped substantially.  There has been a slight increase in demand for financing. However, instead of funding for investments, companies are continuing to seek financing for working capital.The weak economic situation has not dampened the enterprises' willingness to grow: One SME in ten says that it is strongly oriented towards growth, while 37 per cent of the companies say that their aim is to grow within their limits.- It is now important to ensure that no profitable project fails because of the lack of financing.  We are actively seeking growth-oriented companies and we are involved in a large number of national projects targeting growth companies.  One of them is the Team Finland LetsGrow financing programme in which we offer financing without collateral, explains Finnvera's CEO Pauli Heikkilä.After a positive period in spring, companies' expectations about their future investments have turned negative.  About one in five of all SMEs plan to seek financing during the next 12 months, focusing on the acquisition of working capital rather than on obtaining funding for investments.    The proportion of enterprises planning to seek financing is, however, three percent higher than in the spring survey.  The interest in outside financing has grown, especially among strongly growth-oriented companies.Even though, according to the survey, there has not been any change in overall availability of financing, three quarters of all enterprises say that the financing terms have become stricter.Finnvera can continue to participate in the financing of projects in Russia The crisis in Ukraine has created uncertainty in the trade with Russia. The sanctions already in place have also had an impact on the operations of the banks financing the trade. Finnvera is closely monitoring the situation.Russia has been the biggest market for Finnvera's export credit guarantees and a target country for our internationalisation financing. Finnvera can still provide coverage for political and commercial risks for new projects in Russia to the extent that the export product in question or the Russian customer is not subject to EU sanctions.  The chances to take part in the projects are always assessed on a case-by-case basis. - Finnvera may also offer financing for working capital for those SMEs that have suffered as a result of the recent events in Russia. Finnvera's role becomes more important when companies find it difficult to obtain private funding or when there is a temporary weakening in their finances as a result of the overall economic situation, Pauli Heikkilä says.The Federation of Finnish Enterprises, Finnvera and the Ministry of Employment and the Economy jointly conduct the SME Barometer Survey twice a year. The aim is to examine the operations and economic operating environment of small and medium-sized enterprises. The autumn 2014 Barometer Survey is based on the responses submitted by more than 5,800 SMEs.Further information:Pauli Heikkilä, CEO, tel. +358 (0)29 460 2400Jonna Myllykangas, Communications Officer, tel. +358 (0)29 460 2740

Press Releases
25.08.2014
Export credit guarantees now also available for domestic export-related investments

Also large Finnish industrial companies can now get export credit guarantees for domestic industrial investments in machinery and equipment that benefit or help to create new export business. Investment loans will be granted and funded by commercial banks. The change in Export Guarantee Act will enter into force on 1 September 2014.Under the new rules, Finnvera can be a party to financing arrangements in domestic investments that benefit exports. This will make it much easier for Finnish companies competing with foreign equipment suppliers to offer their products for investments of export industries in Finland. Eligible investments can include factory projects, projects aimed at improving the level of processing, and projects involving logistics and other areas of infrastructure that help to improve the operating prerequisites and competitiveness of export companies. Similar credit guarantee arrangements are already in use in many countries competing with Finland, such as Denmark and Italy.– Until now, Finnvera has not been able to provide credit guarantees for domestic projects of large companies. It has been more economical to purchase the necessary machinery and equipment from foreign suppliers as this has allowed the companies to make use of the export credit guarantees provided by the export credit agencies in countries where the suppliers are operating. As a result, Finnish suppliers may have lost contracts to their competitors. Our ability to also provide export credit guarantees to Finnish suppliers’ deliveries strengthens the competitive position of domestic equipment suppliers and promotes employment in Finland, explains Pauli Heikkilä, CEO of Finnvera. Until now, Finnvera's export credit guarantees have been used to facilitate the financing arrangements of export contracts. Companies have also been able to use export credit guarantees for insuring export receivables, bonding and financing during manufacturing. Finnvera already has a range of domestic financing products for investments by SMEs.Under the export credit guarantee scheme, Finnvera can guarantee long-term bank credits obtained by the buyers and thereby share the credit risks with the bank. In domestic export industry investments, the guarantee issued by Finnvera may not, as a rule, exceed 80 per cent of the amount of credit or 50 per cent of debt financing of the project.– Extending the Act on the State's Export Credit Guarantees to cover domestic business of export companies puts the companies on equal footing with their foreign competitors. Until now, only export credit agencies of other countries have been able to take part in the financing of investments in Finland, explains Jorma Turunen, Director General of the Federation of Finnish Technology Industries.The increased export financing authorisation granted to Finnvera and the ability to guarantee domestic investments contribute to Finnish equipment producers and export companies being able to operate and invest in Finland and to sell their products from Finland.Further information:Pauli Heikkilä, CEO, tel. +358 (0)29 460 2400  Topi Vesteri, Executive Vice President, tel. +358 (0)29 460 2676

News
19.08.2014
Finnvera is restructuring its customer service

 We are restructuring our customer service so that we can better meet the needs of different customer groups.Finnvera is restructuring its customer service by concentrating expertise in key areas and by reorganising some of the functions. This will ensure more focused and quicker customer service.Some of the matters now handled by regional offices will in the future be the responsibility of the Service Center.  The responsibilities of the Service Center will include small enterprise customers and change situations faced by customers in their financing. Ritva Reittu, Head of Service Center, will be responsible for the operations of the Service Center.In the future, all Finnvera's services for growth companies and companies seeking to expand their international business will be available in a single unit.  This will allow us to concentrate our expertise in key areas and to better meet the financing needs of these particular customers. Titta Mantila, Vice President, will head the Growth and internationalisation team.Finnvera's offices will continue to operate as before but there will be changes to the regional division.  From 1 September 2014, Finnvera's regions will be as follows: Southern Finland (Regional Director Markus Laakkonen); Central Finland (Regional Director Juha Ketola); Southwest Finland (Regional Director Seija Pelkonen); Southeast Finland (Regional Director Mirjam Sarkki); Savo-Karelia (Regional Director Hannu Puhakka); Ostrobothnia (Regional Director Kari Hytönen); and Northern Finland (Regional Director Pauli Piilma).You can also contact our online service and telephone service in all parts of Finland. The customer service for our export financing will continue to operate as before.Further information: Pauli Heikkilä, CEO, tel. +358 (0)29 460 2400 Finnvera's regions and offices from 1 September 2014Southern Finland: HelsinkiSouthwest Finland: Turku, PoriSoutheast Finland: Lahti, Mikkeli, LappeenrantaCentral Finland: Tampere, JyväskyläOstrobothnia: Vaasa, SeinäjokiSavo-Karelia: Joensuu, KuopioNorthern Finland: Oulu, Kajaani, Rovaniemi

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