Page 43 - EXIM-Bank_Annual-Report-2022

A VISION COMMITMENT EMPOWERING ENSURING ENHANCING FINANCIAL
TO SERVE TO LEAD GROWTH SUSTAINABILITY GOVERNANCE STATEMENTS 41

The Bank also provides export of services facilities As the imported goods are unavailable in the country of import,
to facilitate Malaysian companies in exporting their such financing has the ability to enhance the competitiveness of
professional services overseas, which are typically the products imported. The Bank also offers financing to Malaysian
in the form of consultancy in areas like information manufacturers that are involved or support export-related industries
technology, engineering, architecture and design in selected vendor programmes developed by the Government or its
and other technical services. agencies by financing the working capital needs of such manufacturers
for the post delivery of goods or services supplied to their customers.
Import financing facilities assist Malaysian companies
with the import of strategic goods and services, As at 31 December 2022, the Bank’s total loans outstanding relating
which are unavailable in Malaysia, to promote the to trade finance (including both conventional and Islamic facilities)
socioeconomic development of Malaysia. amounted to RM0.45 billion.
As at 31 December 2022, the Bank’s total loans Guarantees
outstanding relating to term financing (including
both conventional and Islamic banking facilities) Guarantees are made available by the Bank to facilitate the issuance
amounted to RM0.80 billion. of advance payment bonds, performance bonds and standby letters
of credit, required by overseas contracts, undertaken by Malaysian
Trade finance contractors. Such guarantees may also be offered to Malaysian investors
seeking to raise funds overseas.
The Bank makes available various facilities in support
of cross-border trade. Malaysian manufacturers, The Bank facilitates the import of strategic goods that will enhance
exporters and suppliers of Malaysian goods can also the manufacturing capability of Malaysian companies, or which are
take advantage of the trade finance facilities to boost unavailable in Malaysia, through the issuance of letters of credit.
their exports into international markets through The Bank also offers forward foreign exchange facilities that allow
working capital financing under the supplier credit or customers to hedge against adverse fluctuations in the exchange rate.
financing facilities. Such facilities offer pre-shipment
financing as working capital for the production of As at 31 December 2022, the Bank’s total guarantees outstanding
goods prior to shipment and post-shipment financing amounted to RM83.00 million.
as working capital after the shipment of goods,
pending the receipt of proceeds for the exported TRADE CREDIT TAKAFuL/INSuRANCE FACILITIES
goods.
The Bank offers Islamic takaful facilities for short-term trade credit
The Bank also makes available competitively priced insurance and medium- to long-term trade credit.
short-term trade finance facilities to direct exporters
and indirect exporters to promote the export of Short-term trade credit takaful/insurance facilities
manufactured products, agricultural products and
primary commodities under the Export Credit Short-term trade credit takaful covers export, domestic and import
Refinancing (ECR) scheme. ECR is categorised under trade transactions with a policy term of less than one year. The facilities
pre-shipment and post-shipment. Pre-shipment ECR provide “umbrella” cover for exporters/importers who make regular
is an advance to facilitate the production of goods exports to overseas importers and imports to domestic buyers on
prior to shipment and to encourage the development credit for up to 180 days. The facilities also provide cover for exports
of a network of economic inter-dependence between directly from third country suppliers to their destination overseas,
exporters and Malaysian suppliers in industrial without passing through Malaysia. As part of the type of takaful
development. Post-shipment ECR is an advance facilities available to cover short-term commercial credit risk, the Bank
to exporters to finance the export of goods after also provides Shariah-compliant bankers trade credit takaful facilities
shipment, pending the receipt of proceeds for the to protect financial institutions against the risk of non-payment by
exported goods. exporters arising from the default by their customers overseas.
Furthermore, the Bank provides short-term The Bank provides bank letter of credit takaful policies covering
trust receipt financing to importers to bridge Malaysian banks against the risk of non-payment of irrevocable letters
their working capital requirements through the of credit issued by overseas banks in respect of Malaysian exports.
extension of credit under documentary credit Year to date 2022, Bank’s total exposure under short-term trade credit
transactions until the receipt of sales proceeds. insurance/takaful amounted to RM10.12 billion.