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SACE Internationalisation Guarantees

SACE Internationalisation Guarantees. Roma, 11 dicembre 2006. Giulio Dal Magro. A new legal framework for SACE.

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SACE Internationalisation Guarantees

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  1. SACE Internationalisation Guarantees Roma, 11 dicembre 2006 Giulio Dal Magro

  2. A new legal framework for SACE With the adoption of the new Law “14 may 2005 n. 80”, the so called “Competitiveness Decree”, SACE has been authorised to guarantee loans contracted by SMEs or bonds issued following the securitisation of such loans. SACE Guarantees are backed by the Republic of Italy, therefore it allows for a zero risk weighting ratio, according to Basel II criteria To be eligible for a SACE guarantee, loans should possess the following characteristics: • Be tied to an internationalization project / activity of the beneficiary • Contracted at market price • Targeted at small and mid-sized corporates At least 50% of beneficiaries must be SMEs with total turnover < €50M (in accordance with EU criteria). Other beneficiaries cannot exceed €250M total turnover

  3. SACE Guarantee - 1 To be eligible for a SACE guarantee: the loan has to be tied to a specific internationalization activity: • Investments in foreign countries (JVs, acquisitions, partnerships, etc.) • Acquisition of assets (machinery, equipment, licenses, etc.) or investments in R&D to boost the international competitiveness of the Italian firm • Marketing or distribution activities in foreign markets • Any other investment or operating cost which is directly or indirectly connected to the ability of the company to compete in a globalised economy and increase market shares in foreign markets The beneficiary company: • Should have a significant export turnover • Should have an acceptable credit rating (based on bank internal rating system or external rating agency models)

  4. ORIGINATOR ORIGINATOR UnderwritingJunior Tranche Loan Portfolio Assignment to SPV SPV Pari passu first loss guarantee Loan Guarantees Loans to SME’s JUNIOR TRANCHE SENIOR TRANCHE Wrapping Senior Tranche INVESTORS Italian SME 1 Italian SME 2 Italian SME … Italian SME n SACE Guarantee - 2 Phase A – Loan Guarantee Phase B – Securitization

  5. volumes Deals executed: Intesa Export (Banca Intesa), JET (BPVN) Deals in ramp up phase: JET2 (BPVN), Finprogex (BPER), S.Paolo IMI, Capitalia Pipeline: 4 new deals Mln euro

  6. Geographical distribution Concentration of SMEs in traditional export areas of Italy Geographical distribution also influenced by bank’s historical client base Deals in pipeline will balance the geographical exposure towards north-west and center-south of the country

  7. Rating distribution Rating based on Probability of Default forecasts by bank internal rating or external rating agency Concentration of ratings between BBB and BB

  8. Sector distribution Strong concentration of SMEs operating in industrial equipment and textile and clothing, traditionally the most relevant Italian export sectors.

  9. Market distribution Traditional focus on EU and eastern European markets; strong growth of projects aimed at developing business in China and Russia

  10. Disclaimer This presentation has been prepared by the Financial Products Division of SACE S.p.A. solely for information purposes. The information contained herein has not been independently verified. Under no circumstances should this document be used or considered as an offer to sell or a solicitation of an offer to buy any insurance/financial instrument mentioned in it. Any pricing and spreads in this report are indicative and may have changed since the issuance of this document. The information contained herein has been obtained from sources believed to be reliable but SACE does not represent or warrant that it is accurate and complete. The views reflected herein are those of SACE and are subject to change without notice. The products mentioned in this document may not be eligible for sale in some states or countries, or suitable for all types of investors; their value and the income they produce may fluctuate and/or be adversely affected by exchange rates, interest rates or other factors. The forward-looking information contained herein has been prepared on the basis of a number of assumptions which may prove to be incorrect and, accordingly, actual results may vary. The information herein may not be reproduced or published in whole or in part, for any purposes, or distributed to any other party, without the written permission of SACE S.p.A. By accepting this document you agree to be bound by the foregoing limitations.

  11. Contatti Grazie per l’attenzione… Giulio Dal Magro Financial Products Division Tel. 06 6736586 g.dalmagro@sace.it Tel.: +39 06.6736264 - 267 business.school@sace.it

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