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Management Discussion and Analysis Ensuring Sustainability Commitment to Lead Upholding Accountability Financial Statements 21

BANKING FACILITIES In addition, the Bank provides direct exporters and indirect
exporters with competitively priced short-term trade credit
EXIM Bank has established a wide range of Islamic and facilities to encourage the export of manufactured goods,
conventional financing facilities to cater to the financial needs agricultural products and primary commodities under the
of its borrowers. Among the banking facilities offered by the Export Credit Refinancing (ECR) scheme. ECR Financing is
Bank are as follows: divided into pre- and post-shipment categories. Pre-shipment
ECR is an advance to facilitate the production of goods prior
to shipment and encourage the development of a network
Cross-border term financing
of economic inter-dependence between exporters and
Malaysian suppliers in industrial development. Post-shipment
The Bank provides overseas project, contract and investment ECR is an advance given to exporters to help them fund the
financing facilities to Malaysian contractors or investors export of goods after shipment pending the receipt of proceeds
to undertake projects overseas, such as manufacturing, for the exported goods.
infrastructure, and other developmental projects and financing
to Malaysian companies engaging in the supply of Malaysian Furthermore, the Bank offers short-term trust receipt financing
goods and services and making investments overseas. to importers, addressing their working capital requirements
Buyer credit facilities are offered by the Bank to provide through credit extension under documentary credit transactions
opportunities to Malaysian exporters and contractors in bidding until the sales proceeds are received. This financing is
for overseas jobs and contracts. The financing is extended particularly valuable for imported goods not readily available
directly to a foreign government or foreign buyer to facilitate in the importing country, enhancing the competitiveness of
the import of Malaysian goods and services. the imported products. The Bank offers financing to Malaysian
manufacturers engaged in or supporting export-related
In order to help Malaysian businesses export their professional industries in selected vendor programmes initiated by the
services to other countries, the Bank also offers export of Government or its agencies. This involves financing the working
services facilities. These services typically take the form of capital needs of the manufacturers’ post-delivery of goods or
consultancy in fields like information technology, engineering, services supplied to their customers.
architecture and design, among other technical services.

The financing services further extend to import facilities, As at 31 December 2023, the Bank’s total loans outstanding
aiding Malaysian companies with the import of strategic goods associated with trade finance, encompassing both
and services, which are unavailable in Malaysia, to promote the conventional and Islamic facilities, stood at RM0.44 billion.
socioeconomic development of Malaysia.
Guarantees
As of 31 December 2023, the Bank’s total outstanding loans
for term financing, encompassing both conventional and
Guarantees are made available by the Bank to facilitate the
Islamic banking facilities, reached RM4.37 billion (FY2022:
RM0.80 million). issuance of advance payment bonds, performance bonds
and standby letters of credit required by overseas contracts
undertaken by Malaysian contractors. Such guarantees may
Trade finance also be offered to Malaysian investors seeking to raise funds
overseas.
The Bank offers a variety of facilities to support cross-border The Bank facilitates the import of strategic goods, being goods
trade. Malaysian manufacturers, exporters and suppliers of that will enhance the manufacturing capability of Malaysian
Malaysian goods can also take advantage of the trade finance companies, or which are unavailable in Malaysia, through the
facilities offered by the Bank to boost their exports into issuance of letters of credit. The Bank also offers forward foreign
international markets through working capital financing under exchange facilities that allow customers to hedge against
the supplier credit or financing facilities. Such facilities offer adverse fluctuations in the exchange rate.
pre-shipment financing as working capital for the production
of goods prior to shipment and post-shipment financing as As at 31 December 2023, the Bank’s total guarantees
working capital after the shipment of goods, pending the exposure amounted to RM117.75 million.
receipt of proceeds for the exported goods.