egap conference 13 september 2007 berne union and prague club kimberly wiehl secretary-general egap...

EGAP Conference 13 September 2007 Berne Union and Prague Club

Berne Union and Prague Club

Kimberly Wiehl SECRETARY-GENERAL

EGAP Conference 13 September 2007


Long term business trends

0

200

400

600

800

1000

1200

1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006

US

D (

billio

n)

Short Term Medium/Long Term Investment

Berne Union Members‘ New Business 1982 - 2006


New business covered (USD billion) Short Term 969 Medium/Long Term 130 Investment 42 Total 1,141

Premium income (USD billion) Short Term 2.3 Medium/Long Term 3.6 Investment 0.6 Total 6.5

New Business & Premium 2006

Short Term

Medium/LongTerm

Investment

Short Term

Medium/LongTerm

Investment


Claims and recoveries in 2006

Claims paid (USD billion) Short Term 0.8 Medium/Long Term 1.9 Investment 0.1 Total 2.8

Recoveries received (USD billion) Short Term 1.1 Medium/Long Term 31.6 Investment 0.1 Total 32.8


Claims & recoveries vs. premium

Berne Union Members'Claims & Recoveries vs. Premium 1982 - 2006

0

5

10

15

20

25

30

35

1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006

US

D (billions)

Claims Paid Recoveries Premium


1934: First meeting of the Berne Union with 4 members (public and private)

1993: First meeting of the Prague Club. Supported by funding from the EBRD.

2001: Pavol Parizek of EGAP elected as the first Chair of the Prague Club. Followed by Malgorzata Rutkowska (KUKE), Vida Zabukovec (SID) and Csaba Simon (MEHIB).

2007: Prague Club has 14 CEE members, 11 from Africa/Middle East/Asia including 3 multilaterals.

2007:Berne Union and Prague Club together are 70 members insuring 10% of total world export trade

The BU and Prague Club


Prague Club: Business volumes

Prague Club New Export Credit Business 1993-2006 (USD millions)

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Short Term Medium/Long Term Total


New business covered (USD million)

Short Term 16,859 Medium/Long Term 3,042

Total 19,901Change +35.5%

Premium income (USD million)

Short Term 51.3 Medium/Long Term 97.6 Total 148.9

Change +39.6%

New Business & Premium 2006

Short Term

Medium/LongTerm

Short Term

Medium/LongTerm


Claims (USD million)

Short Term 30.2 Medium/Long Term 40.7

Total 70.9Change +22.7%

Recoveries (USD million)

Short Term 6.0 Medium/Long Term 49.6 Total 55.6

Claims and recoveries 2006

Short Term

Medium/LongTerm

Short Term

Medium/LongTerm


• Original aim to provide technical expertise to support institution building of ECAs to promote national exports.

• Rapid expansion of membership as new ECAs could join even before having written any policies.

• Strong growth in ST insurance – followed by developing business in MLT and INV areas.

• Foreign competition enters the home markets – both domestic and export business.

• Cooperation agreements activated to risk share in transactions.

• Operating on a commercial basis from an early stage – reinsurance, capital management and now, privatisation.

PC Developments


• Competition – more market players – more pressure on pricing. How to maintain market share?

• Adapting to EU regulations on marketable risks.

• SME clients – how to meet their needs on a cost effective basis?

• New products – expansion into new types of business.

• Working with banks – maximise opportunities for financing capacity. Impact of Basel II.

• Risk assessment and pricing models. Portfolio and capital management.

• Using technology effectively to streamline administration, underwriting, client communication.

Issues and Trends


Value Statement“We are committed to operate in a professional manner that is

financially responsible, respectful of the environment and which demonstrates high ethical values - all in the best interest of the long-term success of our industry.”

Sound Principles“… to work for the international acceptance of sound principles

of export credit … (and) foreign investment insurance …”

Interaction”… to provide for the exchange of information, assistance,

expertise and advice …”(i.e. providing members with a forum for co-operation & professional

interaction)

What do the BU and PC stand for?


1. We conduct our business in a manner that contributes to the stability

and expansion of global trade and investment on a sound basis, that

is, in accordance with applicable laws and relevant international

agreements

2. We carefully review and manage the risks we undertake

3. We promote export credit and investment insurance terms that reflect

sound business practices

4. We aim to generate adequate revenues to sustain long-term

operations reflective of the risks we undertake

5. We manage claims and recoveries in a professional manner, whilst

at all times, recognising the insureds’ and obligors’ rights

6. We are sensitive about environmental issues and take such issues

into account in the conduct of our business.

BU and PC Guiding Principles


7. We support international efforts to combat corruption and money

laundering

8. We promote best practices through exchange of information on our

activities, policies and procedures and through the development of

relevant agreements and standards, where these are deemed

necessary to govern the provision of export credit and investment

insurance

9. We are committed to furthering transparency amongst members and

in the reporting of our overall business activities, reflective of

international practices and respectful of the confidentiality of third

party information.

10. We encourage co-operation and partnering with commercial, bilateral,

multilateral and other organisations involved in export trade and

investment business.

BU and PC Guiding Principles

egap conference 13 september 2007 berne union and prague club kimberly wiehl secretary-general egap...

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