1
Årsrapport

Annual Report 2017: Industrial transition and new activity throughout Norway

(Press release) GIEK is the Norwegian Government’s largest financial institution for exports, with total exposure limits of NOK 183 billion. In 2017, the volume of applications increased by 27 per cent to 38.6 billion. While the oil service portfolio fell from 86 to 79 percent, renewable energy, aquaculture and other industries increased from 14 to 21 percent. New guarantees totalling NOK 11.8 billion triggered contracts worth NOK 21.5 billion for Norwegian companies and helped maintain 9600 jobs. "GIEK facilitates industrial transition and innovation throughout Norway, a process that continues in 2018," says Ms. Wenche Nistad, GIEK CEO.

Download the Annual Report: print version or web version

Throughout Norway

GIEK promotes business activities throughout the country and Norwegian exports to the whole world. The five largest counties in terms of GIEK guarantees in 2017 were:

1. Møre og Romsdal; 2.4 billion kroner

2. Buskerud; 1.4 billion kroner

3. Oslo: 1.3 billion kroner

4. The Trondelag counties: 0.6 billion kroner

5. Vest Agder: 0.5 billion kroner

In 2018, GIEK will further step up the communication activites towards Norwegian companies and their banks to ensure that existing and new users are familiar with GIEK's many guarantee products.


Maritime and oil service

Norwegian shipyards and their subcontractors continued the transition to the construction of cruise ships and other types of vessels - funded with guarantees from GIEK to both shipyards and several foreign cruise lines. At the turn of the year, the new ship guarantee scheme became active, and will contribute to increased shipbuilding at Norwegian shipyards in the coming year.

"Maritime industry has demonstrated an impressive ability to change and innovate after two years of slowdown in the offshore supply industry", Nistad notes.

GIEK has expertise in maritime finance that promotes Norwegian exports and value creation. The maritime sector is still the largest in GIEK’s portefolio, and GIEK is today is one of the largest financial institutions for offshore vessels and rigs world-wide.

Assisting more industries

Various GIEK guarantees cover many needs among in Norwegian businesses and banks. The product list was expanded in 2017 with a so-called internationalization guarantee, which will stimulate export-related investments in Norway. The first guarantee was granted to Norwegian Fish Company in connection with the company's investments in a state-of-the-art fish processing facility in Finnmark. The second internationalization guarantee was issued in connection with the industrial group Yara’s investment in Porsgrunn.

The green shift - also in GIEK

GIEK issued the very first power purchase guarantees since the scheme was introduced in 2009, to the wind power producer Norsk Miljøkraft in Tromsø, and Norsk Miljøkraft in Raudfjell. The guarantees cover the power purchaser Alcoa's commitments under two power purchase agreements.

Concerning the export of renewable technology, Scatec Solar received new guarantees for its new solar power plants in Egypt and Malaysia.

Wider cooperation with banks

Banks have utlized GIEK for more funding types in 2017 than previously, as new guarantees and schemes became available for both maritime and mainland industries. GIEK issued delivery and payment guarantees in larger volumes than before, along with guarantees for power purchases. At the same time, demand for construction loan guarantees for shipyards also increased. Most new guarantees in 2017 were risk sharing with Norwegian and foreign banks - but always for the benefit of Norwegian businesses.

About half of GIEK's new guarantee liability in 2017 was tied to loans by Export Credit Norway, especially large industrial transactions in the maritime industry, but also in some smaller export contracts for Norwegian SMEs. In 2018, the cooperation will be expanded to include funding for Norwegian-owned vessels for use in Norwegian waters.

Social mission fulfilled

GIEK's mission is to promote Norwegian exports and investments. New guarantees of NOK 11.8 billion triggered new contracts for NOK 21.5 billion for Norwegian companies. In addition, the guarantees have helped sustain or create 9,600 Norwegian jobs in 2017, according to Menon Economics.

It is part of GIEK's social mission to be self-financing, ie revenues, administration costs and payments should break even in the long term. Guarantee premiums in 2017 totalled NOK 1.5 billion, while operating profit ended at NOK 341 million. Losses and write-downs in relation to total exposure increased slightly from 7.5 to 7.9 per cent.

- The guarantees are issued by application only, and subject to a thorough due diligence and credit rating process. With good liquidity, as well as increasing demand from several industries, GIEK has achieved its goals and fulfilled its social mission in 2017, concludes Ms. Wenche Nistad.

Press contact

Mr. Allon Groth, telephone 93251124