Investing in Kazakhstan with SACE
Fabio Fritelli
October 2007
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SACE Group
Credit insurance, reinsurance, investments protection
and advanced financial solutions
Short-term insurance services both in domestic and
foreign markets.
Leader in surety business, specifically in the construction
industry
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A strong financial partner
Gross written premiums
Outstanding
€ 240.5 mln
€ 31,979.9 mln
Net profit
€ 510.1 mln
Equity
€ 5,734 mln
Rating (Moody’s)
Aa2
Key figures 2006
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SACE exposure: sectors
 Strong experience in Oil&Gas sector
O il&Gas
19%
Other Sectors
33%
Chemical
Petrochemical
15%
Power
7%
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Steel
12%
Banks
14%
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SACE’s Terms of Cover in CSI Countries
Open
Open (with conditions)
Off cover
RUSSIA
GEORGIA
KAZAKHSTAN
ARMENIA
AZERBAIJAN
UZBEKISTAN
TURKMENISTAN
KYRGYZISTAN
TAJIKISTAN
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Kazakhstan
Rating
 S&Ps:
BBB
 Moody’s: Baa3
 Fitch:
BBB
OECD
 Country Category 4/7
SACE Cover
Policy
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 Sovereign/Bank/Corporate Risk: Open
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SACE vs Bank Sector in Kazakhstan
Main Financial Institutions positively
assessed for SACE support
Kazkommertsbank
Bank Turan Alem
ATF Bank
Halyk Saving Bank of Kazakhstan
Alliance Bank JSC
Astana Finance JSC
CJSC Development Bank of Kazakhstan
Kazakhstan Investment Fund
Alfa Bank Kazakhstan
Bank Caspian
Bank Centercredit
Development Bank of Kazakhstan
Eurasian Bank
Nurbank
Temirbank
Tsesnabank
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Total Current SACE Exposure
euro 47 M approx.
Maximum available exposure
euro 490 M approx
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Why SACE: benefits
Competitiveness
Security
Longer payment terms for the buyers
Transfer of risk
Liquidity
Credits monetization at competitive costs
Protection
Safeguarding your investments and credits abroad
Stability
Improvement of your balance sheet composition
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Why SACE: Basel II
 Cost of funding based on company credit rating
Basel II effects
 Increased company transparency and disclosure of business information
With Basel II fund raising is more difficult for companies without
an investment grade
 Zero weight for loans guaranteed by SACE
Role of SACE
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 Boost borrowing power
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SACE Range of Activities: 1) Export Related Products
SACE has widened its eligibility criteria:


SACE is now able to provide cover for the financing of:

supply contracts signed by an Italian company; or

supply contracts signed by a foreign company participated for at least 20%* by an Italian company, or

Italian origin supplies under contracts signed by a non-Italian company, and

local costs, in application of OECD Regulation Framework
Italian origin of goods is not an eligibility requirement, as SACE could cover all goods/services (of Italian, EU, or extra EU origin) provided
under such contract
(*) Such threshold is reduced to 10% for listed companies.
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SACE Range of Activities: 2) Non-Export Related Products

Investments made by Italian companies / Italian subsidiaries (*)

Transactions of “strategic interest” for the Italian economy:

Strategic imports (power, gas, oil, raw materials for re-exports);

Strategic foreign customers/partners to Italian companies in their activities abroad;

Infrastructures (including domestic infrastructures) supporting: (a) the
internationalization of the Italian economy (terminals, railways, roadways, etc), or (b)
diversification of energy sources for the domestic market (pipelines, regasification
plants, etc);

Internationalization of Italian banks;

Employment and economic growth in Italy;

Strategic industries: renewable energies, environment, technological innovation
(*) Participated at least 20% by an Italian companies. Such threshold is reduced to 10% for listed companies.
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Credit Insurance
(I) Buyer Credit
(II) Supplier Credit
SACE
SACE
Financing
Bank
Reimbursement
Main Features
Payment of exported
goods
Insurance policy
Insurance policy
Foreign Entities
Payment of
exported goods
Export of
goods/services
Italian
Companies
• Coverage up to 100% for political and commercial risks
• Financing up to 100% of premium amount and IDC
• Tied or multitied financing / refinancing of import
transactions
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Foreign
subsidiary
Italian
Companies
Foreign
Entities
Export of goods and services
• Coverage up to 100% for political and commercial risk
• Monetisation of assets through assignment of the
insurance policy to a financial institution on a prosoluto basis
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PRI: Capital contribution abroad
Structure
A
SACE
Guarantee
Italian
Company
Capital
contribution /
Financing
B
SACE
Guarantee
Foreign
Company
(Recipient)
Foreign
Subsidiary
Capital
contribution /
Financing
Foreign
Company
(Recipient)
Controlling
Stake
Italian Company
Main Features
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•
•
•
•
Coverage including capital contributions, capital goods and others, or subordinate loans and guarantees
Financing of foreign investments also by assigning the insurance policy to a bank
Coverage up to 100% of the investment value as a consequence of a political event
Eligibility for investments via foreign vehicle/holding
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Financial Credit Insurance:
Cross Border Investment & Preshipment Facilities(*)
(I) Cross Border Invest. Facility
Structure
SACE
Guarantee
Funding
Banks
Capital
Markets
Main Features
(II) Pre - Shipment
Italian entities and
/or Foreign
Subsidiaries
Funding
Italian related business
SACE
Guarantee
Banks
Working Capital financing
Italian Entities
Italian Related
Business
• Financing linked to internationalisation of the Italian economy
• First demand guarantee in favour of the funding bank
• Risk participation with the funding bank, on a % to be agreed, against non-payment risk
• Release of the bank’s regulatory capital
• Freeing up borrowers credit lines
• More competitive borrower’s all-in cost of funding
Pricing: participation fee paid by the funding bank to SACE
on an up front / running basis
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Credentials
 Commitment: $ 1.2 bln
 Commitment: € 1 bln
 Insured: Bond Issued by Gazprom
 Insured: Italcementi S.p.a.
 Supplier: Snam,Saipem,Ilva,Nuovo Pignone
 Beneficiary: Ciments Francais
 Country: Russia
 Country: Egypt, India, Kazakhstan, Thailand
 Structure: Structured Finance Guarantee
 Structure: Investment Policy
 Commitment: €230 mln
 Supplier: Danieli & Officine Meccaniche
S.p.a.
 Buyer: OMK Steel (Russia)
 Country: Russia
 Structure: Strcutured Finace
 Commitment: € 50 mln
 Exporter: Ansaldobreda S.p.a
 Beneficiary: DSB- Material
 Country: Denmark
 Structure: Surety Bond
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www.sace.it
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Disclaimer
This presentation has been prepared solely for information purposes and should not be used or considered as an offer to sell or a
solicitation of an offer to buy any insurance/financial instrument mentioned in it.
The information contained herein has been obtained from sources believed to be reliable or has been prepared on the basis of a
number of assumptions which may prove to be incorrect and, accordingly, SACE does not represent or warrant that the information is
accurate and complete.
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