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SACE’s Role as Business Facilitator

SACE’s Role as Business Facilitator. Moscow, April 6th 2009. Index. SACE Group - Introduction. SACE’s products. ITALY- RUSSIA Commercial Flows. Contacting SACE. SACE Group: one group many solutions.

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SACE’s Role as Business Facilitator

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  1. SACE’s Role as Business Facilitator Moscow, April 6th 2009

  2. Index SACE Group - Introduction SACE’s products ITALY- RUSSIA Commercial Flows Contacting SACE

  3. SACE Group: one group many solutions SACE supports companies in developing their business abroad, offering a wide range of credit insurance and reinsurance products, investment protection, surety and advanced financial solutions Credit insurance, reinsurance and guarantees for Italian exports and investments Medium & Long Term 100% Short-term insurance services both in the domestic and foreign market, surety business, specifically in the construction industry Short Term & Surety

  4. Gross Premium € 312 Mln € 33.600 Mln Outstanding Guarantees Net Profit € 377 Mln Shareholder’s Funds € 5.772 Mln Rating (Moody’s) Aa2 Employees 511 SACE Group: a strong financial partner Highlights 2007 312 241 198 167 3Q 08 2005 2006 2007 Gross Premium (€ Mln) Despite Market Turmoil, SACE kept improving the quality and the liquidity of its assets. 3Q2008: Profit 428,5 mln euro (+30% YoY); Claims 14,2 mln euro (-15% YoY)

  5. SACE Group: our perception of risk

  6. SACE Group: a worldwide player More than 155 countries on cover • OPEN: • Potential involvement in all kind of transactions. • OPEN WITH RESTRICTIONS: • Restrictions may apply according to: • counterparts (i.e. sovereign) • amounts (i.e. cap for country or single transaction) • tenors (i.e. short, medium-long term) • ON A CASE BY CASE BASIS: • No cover available. Potential exemptions: • project finance, • co-financing with Multilaterals, local development banks and other ECAs; • investments; • non-credit risks

  7. Risk Coverage RISK GENERATING EVENTS POLITICAL NATURE COMMERCIAL NATURE • Expropriation, nationalisation or any other Government restriction • General moratorium decided by a foreign government • Currency transfer restrictions due to political or economic reasons • Exchange rate fluctuation due to law provisions adopted by the debtor country • Embargo • War, civil unrest or natural disasters • De-jure insolvency of the (private) debtor • Debtor/guarantor protracted default • Purchaser’s arbitrary repudiation, suspension or unilateral termination of a commercial contract • Purchaser’s arbitraryrefusal to accept the exported goods and/or services

  8. SACE Group: new strategic lines of business National Interest Programme Purpose: to support the Internationalization of Italian companies and any strategic interest for the Italian Economy Traditional Business Purpose: to support the Italian exports and diversify SACE’s portfolio Market Window Internationalization Political Risk Insurance Export credit Insurance “Non marketable” business, bound by Consensus Rules “Non marketable” business, off Consensus Rules, supporting the Italian investments abroad New “marketable” business, supporting the Internationalization of Italian Economy New “marketable” business, supporting any strategic interest for the Italian Economy

  9. Traditional Business: new eligibility criteria Exporter’s Country Italy Foreign country 2 - Eligibility of Italian content Financing Cover for non Italian supplies was not allowed 1 - Eligibility of Italian content Limited flexibility to cover the financing of non Italian supplies Traditional eligibility criteria(made in Italy) Italy Content …and… 3 - Eligibility of non Italian content (*) of the export contract signed by an Italian company (*) Local content eligible within the limits set by OECD Regulatory Framework (30%) 4 - Eligibility of supplies by foreign companies participated by Italian companies New eligibility criteria(made by Italy) ForeignCountry

  10. National Interest Programme: new range of activities Support to internationalization and “market window” • Support to internationalization: • Investments made by Italian companies overseas (acquisitions, joint ventures, investment in fixed tangible or intangible assets, etc.) • Internationalization of Italian banks; • Market window: transactions of “strategic interest” for the Italian economy: • Strategic foreign customers/partnersto Italian companies in their activities abroad; • Infrastructures(including domestic infrastructures) supporting the internationalization of the Italian economy; • Strategic imports (power, gas, oil, raw materials for re-exports); • Employment and economic growthin Italy; • Strategic industries: renewable energies, environment, technological innovation.

  11. New products SACE new financial products: some examples • First demand guarantee: from insurance policies to 100% unconditional and irrevocable guarantees (all risks including documentary risk are covered) - Advantages for the borrower: reduction of costs and supporting documents • Project/Corporate bond issuance - advantages for the borrower: (i) lower cost of funding against traditional buyer’s credit, (ii) diversification of funding sources and financial capacity saving with the banking system; (iii) access to a different set of investors in the Capital Markets • Working capital facilities granted to (i) foreign corporate/SPV participated by Italian investors, (ii) Italian exporters • Equity loan cover for the benefit of Italian investors • Political cover for overseas investments • Bid/performance/advanced payment bonds

  12. Why SACE: key benefits to the Borrowers • Risk partner: acting as a risk taker and credit enhancer, SACE decreases syndication risks • Zero Weight: SACE guaranteed assets are zero weighted under Basle I and under Basle II (depending on the local banking regulation) • Flexibility: the new national interest programme widely extends the range of SACE eligible operations • High visibility: SACE support is fully backed by the Italian Government To the bank • Competitiveness: longer tenors and attractive all-in cost of funding • Security: transfer of risk and credit risk enhancer • Capacity provider: safeguarding of company’s investments and bank credit lines • Stability: improvement of the balance sheet composition To the borrower

  13. SACE: Business lines and geographical exposure 2008 Strategic Interest 15% PRI 0% PRI 5% Strategic Interest 16% Traditional Business 61% Traditional Business 65% Internationalisation 24% Internationalisation 14% 2007 3Q 2008 9% 3% 0% 2% 10% 12% 36% 24% 4%

  14. ITALY – RUSSIA: Commercial Flows The European Union was, in 2008, the main trading partner of the country. Among the EU member States, Germany was the largest exporter to Russia, followed by Italy (EUR 10,5 billion), which was also the second largest importing country (16 billion) from the Russian Federation. Total trade amounted to EUR 26,5 billion (+10% vs 2007) and the Italian trade balance deficit reached EUR 5,6 billion (+11%). Such deficit was primarily due to an increase in the import of energy commodities (72% of total Italian import), while the main Italian exports were from the following sectors: mechanical engineering (31% of the total), textiles and wearing apparel (11%) and furniture (8%). In 2008 the Italian export of goods increased by 9.5%, while the Italian imports from Russia rose by 10%. The Italian companies are mainly involved in the energy (ENI, ENEL), civil aircraft (Alenia Aeronautica), electronics and home appliances (Indesit, Candy and Merloni), food & beverage (Parmalat, Perfetti, Ferrero and Cremonini), motor vehicles (FIAT, Iveco) sectors as well as in the banking one (Gruppo Intesa SanPaolo and Gruppo Unicredit).

  15. SACE’s network Moscow Balkans Roma Turkey Hong Kong Johannesburg Sao Paulo Existing offices Monitoring areas Consultants & Advisory

  16. How to contact SACE HEADQUARTERS Rome Piazza Poli, 37/42 • 00187 Rome Tel. +39 06 67361 • Fax +39 06 6736225 Branches Milan Via A.de Togni, 2 - 20123 • Milan Tel. +39 02 434499701, Fax +39 02 434499749 Modena Via Elsa Morante, 71 - 41100 • Modena Tel. +39 059 331201, Fax +39 059 820832 INTERNATIONAL NETWORK Moscow Krasnopresnenskaja Naberejnaja, 12 123610 Moscow - Office n.1202 Tel. +7 49 52582155, Fax +7 49 52582156 Hong Kong 40/f Suite 4001 - Central Plaza 18, Harbour Road Wanchai, Hong Kong Tel. +852 36202323, Fax +852 36210227 Johannesburg Chester Road, 42 2193 Parkwood Johannesburg Tel. +27 11 8800020, Fax +27 11 8801019 Sao Paulo Av. Pauista 1971 – 3° andar 01311-300 Sao Paulo Tel. +55 11 31712138, Fax +55 11 32664051 Turin c/o ICE - Via Bogino, 13 - 10100 • Turin Tel. +39 011 836128 - Fax +39 011 836425 Venice-Mestre Viale Ancona, 26 - 30172 • Venice - Mestre Tel. +39 041 2905111, Fax +39 041 2905103 SACE BT: Piazza Poli, 42 • 00187 Rome Tel. +39 06 6976971 Fax +39 06 697697725 www.sace.it

  17. Disclaimer • This presentation has been prepared solely for information purposes and should not be used or considered as an offer to sell or a solicitation of an offer to buy any insurance/financial instrument mentioned in it. • The information contained herein has been obtained from sources believed to be reliable or has been prepared on the basis of a number of assumptions which may prove to be incorrect and, accordingly, SACE does not represent or warrant that the information is accurate and complete.

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