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Estonian factoring success

Estonian factoring success. Sven Randoja 24. October 2003 Warsaw. Estonia. ESTONIA Capital - Tallinn Population - 1. 4 million Currency - Estonian Kroon (EEK) Exchange Rate- EUR 1= 15,646 EEK GDP 6 , 9 bn EUR. Estonian economy. Macroeconomic highlights. 1999. 2000. 2001.

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Estonian factoring success

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  1. Estonian factoring success Sven Randoja 24. October 2003 Warsaw

  2. Estonia • ESTONIA • Capital - Tallinn • Population - 1.4 million • Currency - Estonian Kroon (EEK) • Exchange Rate- EUR 1= 15,646 EEK • GDP 6,9 bn EUR

  3. Estonian economy Macroeconomic highlights 1999 2000 2001 2002 2003E 1994 GDP -0.6% -2.0% 7.3% 6.5% 6.0% 4.7% 5060 GDP/capita (EUR) 3536 5432 4059 4568 1290 2,238 3,443 (+54%) 3,695 (+7%) 3,633 (-2%) 4,000 (+10%) 1,000 Exports(€ m, %) 3,222 4,614 (+43%) 4,796 (+4%) 5,077 (+6%) 5,635 (+11%) 1,284 Imports (€ m, %) -984 -1,171 (+19%) -1,101 (-6%) -1,444 (+30%) -1,635 (+14%) -284 Trade deficit (€ m, %) -4.7% -6.1% -6.2% -12.5% -7,2% -14.5% CAD / GDP, % CPI 3.3% 4.0% 5.7% 3.6% 1.4% 47.7% 12.3% 13.7% 12.6% 10.3% Unemployment 9.9% 7,3% 15.65 15.65 15.65 15.65 FX rate EEK/EUR 15.65 -

  4. Estonian economy Financial sector • Concentration • 50 banks in 1992 • 7 banks in 2003 • Foreign capital inflow • 86 % foreign investment • SEB • Swedbank • Nordea • Total corporate loans: • 270 mio EUR in 1994 • 2,68 bln EUR in 2003 • Intrest rate(short term average) • 24,3% in 1994 • 3,5% in 2003 • Stock exchange formed in 1996

  5. Development of factoringmarket History of factoring market • Started in 1994 • 3 players in the market • Hansa Leasing • Ühisliising • Bank of Tallinn • Constant growth • In 1998 Hansa Leasing joined FCI • In 2002 Ühisliising started cooperation with Gerling NCM

  6. Development of factoringmarket Portfolio Turnover € m € m Source: Ühisliising

  7. Development of factoringmarket Market penetration Factoring in Estonia - % of GDP % of GDP compare to other countries

  8. Development of factoringmarket Drivers of success • Easy alternative financing instrument • Promotion, good image • Risk assessing easier • Public sector projects • Electronic data exchange • No alternative for credit insurance

  9. Factoring today • Concentration • 5 players in the the market • 2 players owns 90% of the market • Hansa Leasing owns 60% of the market and Ühisliising 30% • Steady growth • More sophisticated • Electronic data exchange • „Traditional factoring“ no more „investment projects“ • Share of total volume • Export 20% • Domestic 77%, • Tax and import 3%

  10. Factoring today Factoring by sector Wholesale and retail sale have been one of most rapidly grown business sectors in Estonia. Source: Ühisliising 2003

  11. Factoring today Factoring clients Factoring clients structure Factoring turnover by client group Source: Ühisliising 2003

  12. Factoring market outlook • Steady growth in pace of economy growth • More advanced technology • E-business • Market stays concentrated • Market enters credit insurance company

  13. Contact Ühisliisingu AS Tornimäe 2 10145 Tallinn Estonia Tel: +372 66 57 910 Faks: +372 66 57 987 e-post: sven.randoja@yl.ee

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