Finnvera’s risk-taking in Russia

Finnvera has continued to grant guarantees for exports to Russia during the global economic crisis.

Finnvera’s risk-taking is active in Russia. Finnvera’s outstanding commitments for export credit guarantees for Russia total EUR 1,033 million, of which offers account for EUR 360 million. Finnvera has altogether 228 guarantees in force and 80 new applications are being processed. In the case of Russia, both the sum of outstanding commitments and the number of guarantees granted are greater than for any other political risk country in Finnvera’s export credit guarantee portfolio.

Finnvera has continued to grant guarantees for exports to Russia during the global economic crisis. Our clients can insure their short-term export receivables with Finnvera; Buyer Credit Guarantees can also be granted for the medium term. A prerequisite for a guarantee is that the buyer’s creditworthiness is assessed and accepted.

Owing to problems in Russia’s banking sector, risk-taking involving private banks has been restricted. State-owned banks can be approved as counterparts, because it is assumed that the Russian government will back them if necessary. For private banks, government backing is uncertain; guarantee decisions are therefore made case by case after careful analysis.

Among reporting OECD member countries, Finland has the fifth largest portfolio of outstanding commitments for export credit guarantees for Russia. When proportioned to the size of the national economy, Finland’s outstanding commitments are roughly the same as those of Germany. For instance, Sweden’s corresponding commitments for Russia are smaller.

Promoting the growth and internationalisation of enterprises is one of the most important goals of Finnvera. Having said that we bear in mind that risk-taking always involves the risk of loss if the counterparty of an export transaction does not meet its obligations. Goals can be reached in a sustainable manner only when the risks taken remain as controlled as possible. If the risk of loss is evident, Finnvera must sometimes decline to offer cover for a project.

Additional information:
Raija Rissanen, Vice President, Research, tel. +358 20 460 7276