ITFC - Fipecafi

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International Islamic Trade Finance
Corporation (ITFC)
(A member of the IDB Group)
Islamic Finance Awareness Seminar
in Brazil
San Paulo, October 4-5
Copyright © ITFC 2010
ITFC Management
Board of Directors
Chairman - President of
the IDB Group
10 Directors
Chief Executive Officer
(CEO)
Deputy Chief Executive
Officer (DCEO)
Copyright © ITFC 2010
2
ITFC Mission & Vision
Mission
vision
We exist to be a catalyst for the development
of trade among OIC member countries and
with the rest of the world
ITFC is to be a recognized provider of
trade solutions for OIC MCs needs
ITFC’s desired future intended state:
 We are fostering OIC MCs trade and tradeintegration
 We are responsive to customers’ needs
with innovative shariah compliant solutions
 We are the preferred choice for trade
solutions
 We are delivering fair returns for our
shareholders
Copyright © ITFC 2010
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Major Objective – Catalyst Role:
> Article 5 of the Articles of Agreement of ITFC states :
“ The purpose of the Corporation shall be to promote trade of member
countries of the Organization of Islamic Conference through providing
trade finance and engaging in activities that facilitate intra-trade and
international trade”
> Makkah Declaration (2005).
Increase the intra-OIC trade volumes to 20% of the world trade by
2015.
Copyright © ITFC 2010
4
Members of ITFC
Financial Institutions
Countries
IDB is the major shareholder of ITFC
Total is 55
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ITFC Establishment:
> Resolution to establish the ITFC was approved during the IDB Board of
Governors meeting in 2005 in Malaysia
> The ITFC’s Articles of Agreement was signed during the IDB Board of
Governor’s meeting in Kuwait in 2006
> ITFC Became operational as of 10 January 2008.
> Authorized capital is US$ 3 billion
> Subscribed capital is US$ 750 million
Copyright © ITFC 2010
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Operating Performance :
Approval of Trade Finance ( 1429H – 1430H )
US$ million
2,505
2,600
2,500
2,400
2,300
2,200
2,100
2,000
1,900
2,166
1429H
Copyright © ITFC 2010
1430H
7
Operating Performance :
> Analysis of approvals :
> Geographic :
US$ million
1429H
Percentage
1430H
Percentage
Asia / CIS
1,281
51%
1,477
68%
MENA
989
40%
530
25%
Africa
235
9%
159
7%
Total
2,505
100%
2,166
100%
Copyright © ITFC 2010
8
Operating Performance :
> Analysis of approvals :
> Public/Private Sector
US$ million
1429H
1430H
Amount
Percentage
Amount
Percentage
Public Sector
1,405
56 %
1,265
58 %
Private Sector
1,100
44 %
901
42 %
Total
2,505
100%
2,166
100%
> Least Developed Member Countries:
>
>
Copyright © ITFC 2010
1429H
1430H
1,082
987
43%
46%
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Operating Performance :
> Analysis of approvals
> Intra-OIC trade “Source of Supply”
>
> 1429H
2,071
> 1430H
1,769
Major Commodities
83%
82%
>
1429H
Crude Oil, Agricultural inputs and Fertilizers, Aluminum,
Industrial Materials
>
1430H
Crude Oil, Industrial raw materials, Sugar, Aluminum, Food
products
> Disbursements
>
>
Copyright © ITFC 2010
1429H
1430H
US$ 1.3 Billion
US$ 1.5 Billion
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Operating Performance :
> Lines of Financing for SMEs
> 1429H
9 Lines
US$ 98.50 million
> 1430H
12 Line
US$169.10 million
> Funds Mobilized : Syndications & Co-Financing
> 1429H
US$ 878 million
35 % of approvals
> 1430H
US$ 794 million
35 % of approvals
Copyright © ITFC 2010
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Key Operational Partners:
> IFC
> AfDB
> SFD
> OFID
> ATFP
> Banks and Financial Institutions in the Middle East, Far East and
Europe e.g. HSBC, JP Morgan, BNP Paribas and other local and
regional banks.
Copyright © ITFC 2010
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Trade Cooperation and Promotion Program(TCPP):
> Activities carried out in the last two years TCPP classified into :
> Trade Promotion
> Trade Facilitation
> Capacity Building
> Development of Strategic Commodities
Copyright © ITFC 2010
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Modes of Financing
> Murabahah (Cost-plus sale) : Under this mode, ITFC will purchase goods or
commodities from a supplier at the request of the Beneficiary and then sell
them to the Beneficiary with a deferred payment arrangement. The difference
between the Purchase Price and the Sale Price is a reasonable mark-up added
to the Purchase Price
> Other Products:
> Bai Ajel (Installment Sale)
> Istisna’a (Manufacturing Contract)
> Ijarah (Leasing)
Copyright © ITFC 2010
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Main Features of Import Finance :
> Transaction Structure
:
Murabaha
> Currency of Finance
:
US Dollar
> Eligible Goods
:
All goods acceptable under ITFC’s
Trade Financing Rules
> Tenor
:
3 – 12 months
> Mark-up
:
According to the market
> Security
:
Bank Guarantee, Sovereign
guarantee, Structured trade
Finance.. etc.
Copyright © ITFC 2010
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Modes of Finance :
> Direct Finance
> Co-finance
> Syndication
> Structured Trade Finance
> Lines of Financing to local banks for the benefit of SMEs.
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Key ITFC-financed strategic commodities
> a) Oil and related products
> b) Raw sugar
> c) Plastics
> d) Chemicals
> e) Coffee, wheat, cotton, etc…
Copyright © ITFC 2010
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Example: Raw Sugar Deal between Indonesian
Importer and Supplier from Brazil
CM
(Warehouse)
4.
ITFC
3.
Documents
presented
Importer
7.
2
1.
5.
6.
payment
Suppliers
Collection
Account Bank
1.
1.
ITFC receives 20% deposit of the invoice from Indonesian Importer. Money is
transferred to ITFC.
2.
Goods are shipped and documents are presented.
3.
ITFC pays the Supplier.
4.
Sugar is delivered to the Warehouse under Collateral Management.CM issues
Warehouse Receipt to ITFC on sugar under custody.
5.
PT AP pays for the value of sugar it requires into the Collection Account.
6.
Escrow Account Bank gives release instruction to CM upon receipt of payment.
7.
Indonesian Importer takes delivery of sugar for refining.
Contact Info
International Islamic Trade Finance Corporation:
> Tel : +966 2 6361400
> Fax : +966 2 6371064
> E-mail: [email protected]
> P.O. Box 55335, Jeddah 21534
Kingdom of Saudi Arabia
Copyright © ITFC 2010
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Thank you
Thank you for your
attention
Copyright © ITFC 2010
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