New OECD minimum premium rates for export credits also apply to commercial risks
As of 1 September 2011, when pricing export credits, Finnvera and the other OECD Export Credit Agencies (ECAs) will take into account the new minimum premium rates agreed within the OECD.
The OECD premium agreement levels the playing field among the ECAs with regard to pricing. The OECD ECAs have adhered to the minimum premium rates for political and sovereign risks since 1999. The new minimum premium rates will encompass commercial risks as well. The minimum rates are based on the risk classification of the country and the obligor (buyer, borrower or guarantor).
Finnvera has used a premium system based on corporate and bank risk classification since 2006. The new OECD minimum premium rates will be taken into account as one element of setting the premium. The minimum rates may not be undercut when granting medium and long-term guarantees (repayment period of 2 years or more) in foreign risk-taking, i.e. buyer credit, credit risk, letter of credit and bank risk guarantees.
A short description of the new premium agreement is available on the OECD-website (Information note on the recently agreed changes to the rules on minimum premium for officially supported export credits).
The changes resulting from the agreement will be incorporated into the OECD Arrangement on Officially Supported Export Credits. The current Arrangement text is available on the OECD-website.
Eeva-Maija Pietikäinen, Vice President, Export Credit Guarantees, International Relations, tel. +358 020 460 7279
Taru Eskelinen, Senior Adviser, Export Credit Guarantees, International Relations, tel. +358 20 460 7126
Pricing of individual transactions:
Advisors/Export Credit Guarantee Underwriting, tel. +358 20 460 11