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Factoring in Czech Republic

Factoring in Czech Republic. Area 78,864 km2 Population 10.4 million Labour force 5.3 million Capital Prague Language Czech Currency Czech Crown (CZK). GDP (US$ bn) 82,0 CPI app. 1 % Gross Foreign Debt (US$ bn) 29,0 10Y Bond Yield 4, 4% CZK/EUR 31,2 CZK/USD 29,0

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Factoring in Czech Republic

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  1. Factoring in Czech Republic

  2. Area 78,864 km2 Population 10.4 million Labour force 5.3 million Capital Prague LanguageCzech CurrencyCzech Crown (CZK) GDP (US$ bn) 82,0 CPI app. 1 % Gross Foreign Debt (US$ bn) 29,0 10Y Bond Yield 4,4% CZK/EUR 31,2 CZK/USD 29,0 3M PRIBOR 2,3 % Key Figures

  3. Economy Structure

  4. Roots of Factoring • Mid 80s in Czechoslovakia • Purpose: guarantee for exports • Fastened FX Cash Flow • Clients: FTO‘s selling consumer goods • Partners: factors in Scandinavia, UK, Germany, Austria, France • Turnover 1989 >100 m EUR

  5. Factoring Now • Purchase of Receivables • Domestic - 80% Recourse • Export – 80 % Non-recourse • Import – 30 % of International (FCI) • Financing of A/R ( Nearly Entirely ) • Less Credit Cover • Collection and S/L Admin

  6. Factoring Clients • Small and Medium Size Companies • Startups /Closedowns • Transforming Companies • Production, Trade and Transportation • T/O 0,75 to 30 Mio EUR • Average Contract Retention 6 to 8 Years

  7. Factoring Volumes

  8. Outlook

  9. Role of Factoring • Distributes working capital to SMEs • Selects and provides financing to small companies with good receivables in the phase of their expansion • Supports companies in their difficult times

  10. What We Need ?In Order to Better Serve Our Clients • Stable Legal Framework • Specification of Factoring in Commercial Code, differentiation from “Bad Debt“ trading • Revision of current wording of Assignment in Law (Ban of Assignment ) • More effective legal system and bankruptcy procedure

  11. Thank You Jiri Matula, Transfinance a.s, Prague, Czech Republic, jiri.matula@transfinance.cz

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