KUKE and ING support Polish exporters’ expansion
By using the latest KUKE guarantee facility, ING will be able to provide further loans to Polish companies focused on international expansion.
Companies interested in developing their export capabilities will benefit from the cooperation of ING with the Polish Export Credit Agency KUKE. According to an agreement, signed in Warsaw, KUKE guarantees for the repayment of loans issued by ING Bank Śląski S.A. and ING Germany for investment projects by exporters or companies planning to sell in foreign markets.
Under its export support system, KUKE has offered several insurances and guarantees since last year. One of the most innovative is a guarantee of repayment of a loan granted especially for conducting domestic export-generated investments. This instrument has already been used in the Polish market for financing raised for example by manufacturers in the automotive and steel industry.
The KUKE guarantee serves as security for a loan up to 80 percent of its value. The minimum loan amount is PLN 5 million and must be reimbursed within14 years at longest. Furthermore, the KUKE guarantees may cover investment projects of companies that achieve at least 20 percent of revenues from export over a period of 3 years or intend to achieve such a level. It is also possible to provide such a guarantee for previously started projects.
Modernizing production, introducing innovative solutions, and increasing production capacity are necessary for effective competition on the international market and gaining shares in it. And this is only possible through investments. Polish exporters and their creditors have at their disposal an instrument which, by taking the risk off them, encourages them to invest in their development. Companies can allocate funds, for example, to build a new hall, purchase land, production line or machines. We are glad that two banks are joining the group of banks benefiting from our guarantees: ING Bank Śląski S.A. and ING Germany, providing services to a wide range of exporters.
The unprecedented shocks in the global economy over the recent years, particularly Covid-19 pandemic and the war in Ukraine, the increased uncertainty or geopolitical tensions may call for restraint on investing. However, we at ING Bank Śląski endeavor to provide active support to entrepreneurs who plan their development in a reasonable way and who undertake investment projects to improve their safety and resilience in those difficult times, including expansion into foreign markets. Over the last decades or years, prior investment projects made it possible for total exports to grow; they also revealed top Polish export items, such as white goods, vehicles and car parts, train carriages, batteries to electric cars or furniture. The war in Ukraine also makes businesses prone to diversify the sale markets and look for ways to replace products imported from the east. The energy shock is a cost for companies; however, it does accelerate the unavoidable energy transformation and investments in renewable energy sources, energy-efficient technologies and e-mobility. Our research suggests that foreign businesses strive to increase safety and security in their delivery chains and Poland may actually benefit from that trend.
I am convinced that the KUKE guarantees will make it possible for us to spend more funds on lending to our clients who have a significant share in export sales and to those who have so far been cautious about going global with their business. With the new instrument, companies will get access to higher financing amounts on favourable terms and conditions, and – what may be the most important aspect in this extremely difficult external environment – the new instrument will improve their safety as they expand their business internationally.
We are pleased to leverage our global franchise to support Polish exporters while at the same time accompanying our German client base in pursuing investments in Poland. By ING Germany and ING Bank Śląski S.A. teaming up we will create immediate value for our clients, by bringing together the best of both worlds – the deep knowledge of the clients at ING Bank Śląski S.A. and the profound ECA and structuring expertise of the global Center of Competence for Export Finance at ING Germany. Joining forces with KUKE by means of the framework agreement signed today will allow us to offer new financing options to our clients that will be attractive to all parties involved. We trust that this is a further step in deepening ING’s partnership with KUKE.
As part of Europe’s most comprehensive export support systems in Europe, KUKE introduced new instruments and modified the range of existing solutions. In addition to the above-mentioned, there are guarantees of repayment of liabilities to suppliers as important in finding new sources of supply and guarantees for financing the supply chain, which help exporters to raise additional funds from banks and factoring companies. Moreover, as part of the program Shop in Poland, KUKE is actively looking for Polish entrepreneurs who are willing to participate by exporting goods or services – "without leaving home" – into infrastructure projects in the most remote areas of the world, where the insurer is financially involved. For all of the solutions, the procedures and documentation requirements have been simplified, and the scope of goods as well as services covered by them, and the possibilities of their use have been expanded.
The use of these instruments strengthens the exporter's financial capacity, positively influencing its relations both with the financing banks and with its contractors, enabling it to a significant increase in the scale of its operations. Many companies from various industries, from automotive, steel, through food, chemical to shipbuilding have taken advantage of KUKE’.
The cooperation agreement was signed by representatives of three parties: President of KUKE Janusz Władyczak, Vice President of KUKE Katarzyna Kowalska, Vice President of ING Bank Śląski S.A. Michał Mrożek, Head of Transaction Services Department at ING Bank Śląski S.A. Monika Dąbrowska, Head of Wholesale Banking / Member of the Board at ING Germany Eddy Henning and Director / Structured Export Finance at ING Germany Oksana Milka.