Advance information about Finnvera’s operations in 2017: Export financing grew strongly – in growing and internationalising enterprises, investments accounted for an increasingly large share of financing
Finnvera’s export financing grew strongly in 2017. Finnvera granted nearly 80 per cent more export credit guarantees and special guarantees than in the previous year. The volume of export credits also increased significantly, to EUR 6.6 billion. Financing concentrates especially on the shipping and telecommunications sectors, where Finnvera was involved in the largest financing projects in its history. In SME and midcap financing, the focus is on growing and internationalising enterprises. Investments accounted for an increasingly large share of the overall projects of growing and internationalising enterprises in 2017. The number of the financed transfers of ownership also remained high.
The volume of export credit guarantees, special guarantees and export credits grew
In 2017, granted export financing grew as expected: Finnvera granted export credit guarantees and special guarantees amounting to EUR 7.5 billion (EUR 4.2 billion), which is nearly 80 per cent more than in the previous year. The volume of export credits also increased significantly, with the amount granted by Finnvera totalling EUR 6.6 billion (EUR 0.8 billion).
Finnvera’s authorisation to grant export credit guarantees rose to EUR 27 billion at the beginning of the year and the authorisation to finance export credits to EUR 22 billion, which made it possible to respond to the increasing demand for financing.
The outlook for export industry is good. Especially in shipping, telecommunications, energy and forestry sectors, companies have orders booked even for years to come. In the EUR 22.2 billion exposure for export credit guarantees and special guarantees, drawn guarantees and credits accounted for approximately EUR 9 billion. This means that more than half of the exposure was tenders or agreements that are related to future deliveries by export companies and extend up to 2024.
In 2017, Finnvera was involved in the largest ship financing transaction in its history, which was also its largest-ever individual financing project: Finnvera contributed more than EUR 2.5 billion to financing the order for ships by the shipping company Royal Caribbean Cruises.
In the telecommunications sector, Finnvera was involved in providing approximately EUR 1.3 billion in financing for Nokia’s telecommunications equipment deliveries to the teleoperator Verizon. Financing was a result of cooperation between export credit agencies: the Canadian export credit agency Export Development Canada (EDC) also took part in the arrangement of financing. This financing arrangement carried out jointly by export credit agencies is the first of its kind.
Major financing and export projects have a significant impact on employment both for the exporting company and the subcontracting network, and Finnvera is involved in financing the entire value chain of enterprises that operate in the key sectors of the Finnish export industry. An excellent example of the far-reaching impact of investments by large corporates is Metsä Fibre’s bioproduct mill inaugurated in Äänekoski in 2017.
Financing for growth, internationalisation and transfers of ownership increased
In 2017, Finnvera granted a total of EUR 963 million (EUR 1,040 million) in financing to SMEs and midcap enterprises, showing a year-on-year decrease of seven per cent. This decrease is mainly due to the fact that the European EFSI guarantee, used actively by banks, partly reduced the need to use Finnvera’s guarantees.
However, Finnvera’s financing to growing and internationalising enterprises increased, in line with the strategy. The share of growing and internationalising enterprises out of all financing grew to 40 per cent (38%). In euros, the share was EUR 385 million.
The investment activity of growing and internationalising enterprises took an upward turn in 2016, after a long period of decline, and both the number of projects financed and the EUR amount of investments financed continued to increase in 2017. In growing and internationalising enterprises, the euro-denominated share of investments in the overall projects financed increased to approximately EUR 180 million, or 19 per cent (17%) The increase in software and service concept exports can also be seen in the structure of investments—the share of intangible investments is growing in a trend-like manner.
SME and midcap financing exposure was EUR 2.5 billion at the end of 2017.
Transfers of ownership gained a lot of visibility during the year, which goes to show that the significance of company acquisitions for the vitality of business life and for the establishment of growth companies has been recognised. The number of transfers of ownership financed in 2017 was at the same level as in the previous year. Finnvera was involved in financing nearly 1,000 transfers of ownership with EUR 121 million (EUR 141 million).
Finnvera will release its financial statements for 1 January–31 December 2017 on 20 February 2018. The Annual Report will be published on Finnvera’s website in Week 8.
Pauli Heikkilä, CEO, tel. +358 29 460 2400