Finnvera receives permission to guarantee short-term export transactions

The European Commission has granted Finnvera temporary permission to guarantee export transactions in EU Member States and in other Western industrialised countries when the payment term is under two years. The exporter must always first apply for insurance from a private provider of credit insurance.

According to the EU rules on State aid, Finnvera – as a public export credit agency – cannot insure risks that private insurance companies are able to insure in a normal market situation. Because the global financial and crisis that started in autumn 2008 has reduced the risk-taking capacity of private credit insurance companies, Finland filed an application with the European Commission for temporary permission to offset the market failure arisen in the provision of short-term credit insurance.

The permission given by the Commission applies to exports to EU Member States and other Western industrialised countries and is valid until 31 December 2010. Finnvera can only insure export transactions that private providers of credit insurance do not cover.

– It’s good that Finnvera is allowed to open credit insurance for countries where public guarantors are not needed in normal conditions. Finnvera grants credit insurance for exports to EU Member States and other industrialised countries according to its own risk assessment; the buyer must be creditworthy. According to the decision of the EU-commission, Finnvera must charge insurance premiums that are at least at the same level as the market prices. says Executive Vice President Topi Vesteri, who is responsible for export financing.

Short term credit insurance for marketable risks

Additional information:

Topi Vesteri, Executive Vice President, tel. +358 20 460 7238
Annamarja Paloheimo, Senior Vice President, tel. + 358 20 460 7267
Benita Salenius, Senior Adviser, Head of Team, tel. +358 20 460 7342