KUKE and Bank Pekao S.A. support the construction of a gas compression plant in Estonia by a Polish company
KUKE together with Bank Pekao S.A. have made available a new financial solution supporting Polish exporters. It consists of an advance payment bond and pre-financing of the export contract combined with a loan repayment guarantee. The first to take advantage of this solution was the Kraków-based Control Process, which will now be able to perform two contracts for the construction of a gas compressor station in Estonia. The contracts are carried out as part of the Balticconnector project, i.e. a gas connection from Finland to Estonia.
Thanks to the financial solution of Bank Pekao S.A. and KUKE, we are able to perform two contacts with a total value of as much as EUR 60 million - said Wojciech Wiatr, President of the Management Board of Control Process.
This is yet another financial instrument prepared jointly by the Export Credit Insurance Corporation and Bank Pekao S.A. providing real support to Polish exporters. It can be successfully applied by Polish companies from various industries that perform contracts in foreign markets.
The main advantages of the solution are:
- contract bond for construction services provided outside Poland,
- export pre-financing, which enables the contract to be financed in the form of a loan partially insured and guaranteed by the Export Credit Insurance Corporation,
- reduction of the risk assumed by the bank - the instrument reduces the bank's risk by means of KUKE’s participation in the transaction, thus creating an opportunity to finance subsequent contracts under a credit line granted to the same entity or others,
- available to Polish companies from various industries offering their services in foreign markets,
- comprehensive solution available in one bank without the need to involve many financial institutions.
Polish entrepreneurs need real support for their export activity. They often have excellent specialists, unique knowledge and solutions, and yet it is difficult for them to break into other markets. An important obstacle is the issue of project financing - without which it is not possible to carry out the tender. Together with Bank Pekao S.A. we have created an instrument that makes it easier for Polish companies to win new contracts. The use of loan repayment guarantees and KUKE counter-guarantees reduces the risk incurred by the bank, which allows the entrepreneur to obtain comprehensive project financing in one place. All it takes is going through the standard verification and risk assessment. The product is available to all companies, even small ones, that want to carry out foreign contracts. It will certainly work well in the construction sector, which often has to provide its own project financing. In a situation where tensions appear in the domestic construction market, export of this type of services may be a good solution for many entities from this sector - said Janusz Władyczak, CEO of KUKE.
As announced, together with KUKE we have implemented another new tool supporting Polish exporters. The proposed financing structure made it possible to obtain a decision on new credit exposures, which has not been possible in recent years. An export guarantee product is complemented by an export pre-financing credit, which allows the customer to close the project financing. The scheme developed in this transaction may be used by other companies, also operating in other sectors. Thus, we are creating a strong base for Polish entrepreneurs who want to develop in virtually any market - said Piotr Stolarczyk, Managing Director of the International Banking and Export Financing Department at Bank Pekao.