Export Credit Norway Q4 and full-year 2018 figures

Q4 2018: Popular new ship financing solution

While Export Credit Norway’s application inflow remained stable in the final quarter of 2018, the full-year application numbers and volume were boosted considerably by the company’s new ship financing solution.

In the fourth quarter of 2018, Export Credit Norway received 81 financing applications (Q4 2017: 69) representing a total application volume of NOK 23.6 billion (Q4 2017: NOK 24.2 billion). In volume terms, the application inflow was at approximately the same level as in three of the last five quarters. Five of the applications received in Q4 related to the new ship financing solution that became operational on 1 July 2018.

Export Credit Norway signed new loan agreements totalling NOK 2.2 billion (Q4 2017: NOK 2.5 billion) in the fourth quarter, and disbursed NOK 474 million in new loans (Q4 2017: NOK 884 million). The Q4 2018 disbursements related primarily to ship equipment. Loans are disbursed on project delivery.

Some 52 % of all financing applications received in the fourth quarter of the year came from small and medium-sized enterprises (SMEs) – the highest SME proportion in the company’s history. In total, SMEs accounted for 27.2 % of the fourth-quarter application volume.

“Although the SME segment currently entails considerably higher investment effort per disbursed krone, we will continue to focus on this customer group. Our aim of facilitating and fostering new export initiatives and industries gives us a long-term perspective,” says Export Credit Norway CEO Otto Søberg.

CEO of Export Credit Norway Otto Søberg

2018: greater variation in the application profile

In 2018, Export Credit Norway received 304 applications (2017: 241) for export financing, representing a total application volume of NOK 175.6 billion, up from NOK 124.4 billion in 2017.

Compared to previous years, the new applications received in 2018 were spread more evenly across different segments, including oil and gas equipment, fisheries and aquaculture, industry, offshore vessels, passenger vessels and merchant shipping, and renewables. In volume terms, industry and renewable energy were notable growth areas, as well as passenger vessels and merchant shipping.

“Although the year-end lending portfolio was dominated by loans to the oil and gas industry and for offshore vessels, the application profile changed considerably in 2018, becoming more varied than previously. We are enjoying increasing success in our efforts to build awareness of export financing in new industries,” says Otto Søberg.

Popular ship financing solution

During the course of 2018, Export Credit Norway received 27 applications under the new ship financing solution, which allows the company to provide financing to Norwegian purchasers of vessels constructed at Norwegian yards and intended for use in Norwegian waters.

“In total, the applications we have received represent approximately 40% of the value of all new-build contracts entered into by Norwegian shipyards in 2018. This confirms that both shipping companies and yards value the new solution,” says Otto Søberg.

Improved access to capital in certain industries

Export Credit Norway’s lending balance totalled NOK 61.2 billion at year-end, down from NOK 68.1 billion at the same time last year. The decline is primarily attributable to a number of early loan redemptions during the year.

“Capital access appears to be improving in certain industries and for certain customers, but we are still receiving financing applications for new projects. Customer feedback indicates that Export Credit Norway is contributing to contract realisation, even in cases where foreign purchasers ultimately decide to secure financing from other sources. We are pleased to hear this. Our job is to support Norwegian exporters during market upturns and downturns, by providing an alternative to commercial banks and other sources of financing,” says Otto Søberg.

As at the end of 2018, 72% of the loans in Export Credit Norway’s lending portfolio were guaranteed by GIEK. The remainder are guaranteed by Norwegian banks (14%) and foreign banks (14%).

Export Credit Norway is a state-owned limited liability company that provides Norwegian and foreign companies with loan financing for purchases of goods and services from Norwegian exporters.

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Ellen B. Svaheim
Ellen B. Svaheim Head of Communication +47 482 24 093 +47 482 24 093

Published 24. Feb 2019