Second tertiary: Norwegian exports worth 13 BN NOK.

GIEK issued 62 new guarantees in T2 that supported Norwegian exports valued at around 13 billion. Offshore-related applications are expected to decline, but the demand from exporters in other industries is expected to increase. An increasing number of guarantees have been redeemed before maturity, and many refinancing transactions are occurring in the bond market

- We experienced a very high volume of new guarantees in T2, close to NOK 10 billion. This is twice as much as in the previous four months, and the largest guarantees were issued to the rig market. We now expect a somewhat smaller activity in the oil sector, and our capacity to contribute to new and exciting projects is increasing, says Wenche Nistad CEO at GIEK.

- The improved capital market combined with liquidity in the bond markets in Norway and the United States, offers the borrowers attractive refinancing opportunities. This has led to several early guarantee and loan redemptions, she adds.

GIEK’s guarantee portfolio remained relatively stable at 76.7 billion in T2 compared to 79.1 billion in T1. The number of binding offer guarantees (pledges) have slightly decreased. GIEK’s guarantees and binding offers totaled NOK 112.8 billion at the end of T2, around NOK 6 billion lower than in T1. In the interim report to the Ministry of Trade, Industry and Fisheries, the GIEK board states that GIEK has a satisfactory activity level reaching the business goals with a profit of 1.075 billion.

Stable demand for guarantees, and an increase in renewable energy
Norwegian companies' demand for export guarantees from GIEK remains high, with 64 applications in T2 compared to 55 applications in the same period last year. The amount of applications during the period totaled 14.2 billion compared to 13.0 billion in the corresponding period last year. The application volume shows a reduction in the maritime sector compared to the same period in 2013, and an increase in renewable energy and industry.

- We are excited that export projects within our focus area renewable energy continues to increase. For example, in T2 we issued a guarantee for the financing of the Seatower project, says Nistad.

Seatower AS will deliver engineering and design services for the construction of an offshore meteorological station outside Normandy in France. The project enables the company to test its proprietary technology for foundation of wind turbines on the seabed. The delivery will provide data about the possible use of their technology in large wind farms worldwide.

Simplified application and easier process for companies
GIEK introduced a new lender guarantee in T2 involving simplified documentation for customers and easier processing. GIEK cooperates closely with Export Credit Norway on simplifying the customer application processes, by better internal procedures when both institutions are involved in the financing of the same contract.

The accumulated profit for all schemes is NOK 1.075 million, which is up from NOK 919 million in T2 2013.

- We can look back on T2 and say that our operations were strong, our activity level has been satisfying, and our objectives have been met. Based on the level of demand, the board expects GIEK’s high level of activity to continue throughout the year, says Nistad