Net up 10.6 pc at Rs 299 cr in 2006-07;
Disbursements Zoom 47 pc to Rs 22076 cr

Exim Bank Excels in
Silver Jubilee Year

Export-Import Bank of India (Exim Bank) has declared an all-round improvement in its performance during the financial year 2006-07 ending March. Exim Bank's Chairman and Managing Director T.C. Venkat Subramanian, announced the Bank's results for the year, the 25th silver jubilee year of the Bank's operations, recently in Mumbai.

The Financial Highlights Include:
• Net Profit (after tax) at Rs. 299 crore, an increase of 10.6 percent over the previous year.
• Rs. 95.62 crore will be transferred to the Central Government as per the Exim Bank Act, as compared to Rs. 86.75 crore in 2005-06.
• Capital Adequacy (Capital to Risk Assets Ratio) stood at 16.38 percent.
BUSINESS PERFORMANCE
• Loan approvals aggregated Rs. 26762 crore during 2006 - 07 as compared to Rs. 20489 crore in the previous year, an increase of 31 percent. Disbursements aggregated Rs. 22076 crore, as compared to Rs. 15039 crore during the previous year, an increase of 47 percent. Loan Assets increased by 29 percent moving upwards to Rs. 23274 crore as on March 31, 2007 from Rs. 18028 crore as on March 31, 2006.
• Net NPAs formed 0.5 percent of net loan assets as on March 31, 2007.
• During the year, the Bank extended sixteen Lines of Credit (LOCs), aggregating US$ 542 mn, covering 42 countries to support export of projects, goods and services from India. Seventy three LOCs covering eighty three countries in Africa, Asia, CIS, Europe and Latin America, with credit commitments aggregating US$ 2.3 billion are currently available for utilisation, while a number of prospective LOCs are at various stages of negotiation. The Bank lays special emphasis on extension of LOCs as it is an effective market entry mechanism especially for small and medium enterprises.
• Project export contracts supported by Exim Bank amounted to Rs. 14000 crore and were secured by 21 companies in 20 countries.
• As on March 31, 2007, guarantees on book were at Rs. 3536 crore.
RESOURCES/TREASURY
• The Bank raised borrowings of varying maturities aggregating to Rs. 10621 crore, comprising Rupee resources of Rs. 6461 crore and foreign currency resources of US$ 957 mn. equivalent.
• Market borrowings as on March 31, 2007 constituted 85 percent of the total resources.
• During the year, Government of India subscribed Rs. 50 crore towards capital of the Bank and Bank's paid-up capital increased to Rs. 1000 crore, which is equal to the current authorised capital of the Bank as on March 31, 2007. Government of India is in the process of increasing the authorised capital to Rs. 2000 crore.
• Foreign currency resources raised during the year included US$ 269 million. equivalent by way of second issue of Samurai bonds/FRNs. FC resources of US$ 688 million equivalent were raised through bilateral/club loans. As on March 31, 2007, the Bank had a pool of foreign currency resources equivalent to US$ 2.57 billion.
• The Bank's domestic debt instruments continued to enjoy the highest rating viz. 'AAA' from the rating agencies, CRISIL and ICRA. As on March 31, 2007, outstanding Rupee borrowings including bonds and commercial paper amounted to Rs. 14534 crore.
• During 2006-07, Standard & Poor's and Fitch Ratings have upgraded the Bank's credit rating from BB+ to BBB. The Japan Credit Rating Agency (JCRA) enhanced the outlook on the Bank's BBB credit rating to 'positive' from 'stable'. Taken together with the Baa3 rating from Moody's, the Bank at present holds investment grade rating on par with the India sovereign from four international credit rating agencies.
NEW INITIATIVES
Joint Venture with Khadi and Village Industries Commission
• The Bank is in discussion with the Khadi and Village Industries Commission (KVIC), to set up a joint Export Marketing Organisation that will contribute to capacity building of grassroots business enterprises, and promote exports of products from rural enterprises thereby resulting in inclusive growth. The Bank would help KVIC in identifying products with export potential, countries keen on importing such products and interested buyers abroad. The project will have an initial investment of Rs. 5 crore, of which Rs. 2 crore each will be contributed by Exim Bank and KVIC with the balance Rs. 1 crore to be subscribed by a number of NGOs / SHGs engaged in production of rural agro/handicraft products. While Exim Bank's Board has approved the investment, KVIC is in the process of obtaining approval of Government of India for their investment.
Rural Grassroots Business Initiatives
• The Bank has introduced an innovative facility to support globalisation of rural industries through its Grassroots Business Initiative. Towards this end, Bank has consciously sought to establish, nurture and foster a variety of institutional linkages. One such example is a cooperation arrangement with the Confederation of NGOs of Rural India (CNRI), a non-profit organization with membership of 5000 NGOs spread across all provinces of India. Under this arrangement, Exim Bank assists CNRI members with capacity building, training and access to national and global markets.
• The International Finance Corporation (IFC), a member institution of the World Bank Group, has set up a display-cum-sales centre called 'Pangea' at Washington D.C. where agro and rural products from various developing countries are displayed. The Bank, in association with IFC, organised an 'India Day' at Pangea at which products produced by a number of NGOs / SHGs in India were displayed.
• The Bank is also actively involved in extending export market access support to rural products through innovative export marketing services, effectively utilising its overseas offices and institutional linkages, as also by extending lines of credit to overseas buying houses and department stores for importing a variety of products from India. Exim Bank has thus been able to leverage such lines of credit to promote export of agro and rural products, and has arranged for procurement of orders from Singapore, South Africa, Hungary, USA for such products.
Focus on SMEs
• Special Line of Credit from ADB: The Bank is negotiating a long term Line of Credit of US$ 250 mn. from the Asian Development Bank, without Central Government guarantee, for extending loans to SMEs. The Bank will have an option to draw the funds in different currencies, as per the needs of its customers.
• Innovative Programme for SMEs: The Bank has entered into a cooperation arrangement with the International Trade Centre (ITC), Geneva for implementing a unique Enterprise Management Development Services program, which is an IT based facilitator to enable small enterprises to prepare business plans with the international market in focus. This is a pioneering initiative for supporting SMEs and for providing term loans and export finance facilities to the identified units to help them in their globalisation efforts. The Bank is partnering ITC in implementing this programme as a pilot project. The Bank thus supports small enterprises through capacity building and assistance in formulation of viable proposals. It is envisaged that the learning from this programme would be transferred to other developing countries, and thus assist in capacity creation and institution building in the global arena.
Untied Loan of US$ 100 million equivalent from the Japan Bank for International Cooperation
• During the year, Exim Bank entered into an agreement for an Untied Loan facility with the Japan Bank for International Cooperation (JBIC). The facility provides competitively priced resources equivalent to US$ 100 million to the Bank, on long term basis, for on lending to eligible Indian borrowers. The proceeds will be on lent to corporates which have business relationships with Japanese companies, Indo-Japanese joint ventures and subsidiaries both in India as well as overseas and other eligible users.
Global Network of Exim Banks and Development Finance Institutions (G-NEXID)
• Exim Bank of India with the support of a number of other Exim Banks and Development Finance Institutions (DFIs) from various developing countries in Asia, Africa, Latin America and CIS have set up a Global Network of Exim Banks and DFIs called G-NEXID under the auspices of UNCTAD in Geneva to boost South-South Cooperation in trade and investment. The second Annual Meeting, held on March 22, 2007, witnessed the technical launch of G-NEXID's official website (www.gnexid.org), whose objective is to create competitive online presence, facilitate information and experience sharing, brand building, training and conduct of business among the member institutions. G-NEXID has been granted 'observer' status by UNCTAD.
US$ 1 Billion Medium Term Notes (MTN) Facility
• During 2006-07, a Medium Term Notes (MTN) programme for US$ 1 billion has been established by the Bank to facilitate raising of resources in the international debt capital market on a regular basis. The programme will offer flexibility to the Bank in terms of quantum, structure and timing of raising foreign currency resources.
Overseas Investment Finance Programme
• The Bank has a comprehensive programme in terms of equity finance, loans, guarantees and advisory services to support Indian outward investment. During the year, 28 proposals were sanctioned funded and non-funded assistance aggregating Rs. 1940 crore for part financing their overseas investments in 15 countries including Spain, UK, Indonesia, Malaysia, Norway, Brazil, Egypt, Israel, Iran, Dubai etc. Exim Bank has provided finance to 176 ventures set up by over 147 companies in 54 countries so far. Aggregate assistance extended for overseas investment amounts to Rs. 4960 crore covering various sectors including pharmaceuticals, home furnishings, ready made garments, chemicals & dyes, computer software & IT, engineering goods, natural resources (coal & forests), metal & metal processing, and agriculture & agro-based products. Overseas investments supported by Exim Bank during the year include : acquisition of a Spanish company engaged in manufacture of branded generic formulations; acquisition of a large home textiles company in the UK; acquisition of South East Asia's largest Design & Build/EPC Company in Singapore; acquisition of a company in Indonesia which owns mining rights in Indonesian coal mines; acquisition of an agrochemical company in the Netherlands; acquisition of an oil drilling company in Norway; acquisition of a company in Malaysia which is the owner and operator of the largest integrated pulp and paper mill in Malaysia along with large concessions of forest land; setting up a wholly owned subsidiary in Sharjah, UAE for manufacture of liquid packaging (HDPE Drums).
Focus on Gulf Co-Operation Council Countries & Central Asia
• During the year, the Bank opened a representative office in the prestigious Dubai International Financial Centre, Dubai. The Dubai office of Exim Bank is expected to play a key, catalytic role in further enhancing trade and investment flows between India and the Middle East Region. By virtue of its strategic location, the office will also help Indian companies increase their business in the Central Asian and North African regions.
RESEARCH & PLANNING
• Five Occasional Papers were published by the Bank during the year, namely, Japanese and US Foreign Direct Investments in Indian Manufacturing: An Analysis; Maghreb Region: A Study of India's Trade and Investment Potential; Strengthening R & D Capabilities in India; CIS Region: A Study of India's Trade & Investment Potential and Indian Chemical Industry: A Sector Study. During the year, the Bank also published a Working Paper titled "Indian Construction Industry: Opportunities Abroad".
• The Bank also brought out a publication titled "Looking through the Kaleidoscope: India and Globalisation" which is a compendium of Exim Bank's Commencement Day Annual Lecture Series for the period 1986 to 2006, in commemoration of Exim Bank's Silver Jubilee.