Pre-Shipment Export Finance
1. Who can be the borrower under the Programme Pre- and Post-Shipment Export Finance?
The borrower is, as a rule, the commercial bank with which HBOR concluded Co-operation Agreement on Implementation of the Programme.
Final borrowers are legal and natural persons registered in the Republic of Croatia exporting Croatian goods or services and operating at least one year.
2. What can the final borrower finance out of this loan?
Final borrower can finance the procurement of necessary production materials, fuels, employees' salaries, accompanying purchase costs etc.
3. What is the maximum loan amount that can be extended under this programme?
In co-operation with its commercial bank, the final borrower estimates the necessary loan amount. HBOR does not determine the maximum loan amount, since its depends on the amount of planned and contracted export transactions.
4. Must the final borrower be an exporter (at least 30% of income generated through exports)?
It is not a condition under this loan programme. Final borrowers who have not been exporters so far and have agreed export transactions are eligible for financing.
5. Are these loans extended with the currency clause?
Loans are extended in HRK and are not foreign-currency indexed.
6. What are the costs of loan approval for the final borrower?
Final borrower is to pay one-off loan application processing fee of 1% of the extended loan amount before the first loan disbursement and the commitment fee for extended and undisbursed loan amount of 0.25% p.a.
7. The company exports wooden logs. Can we utilise a credit under the Programme Pre- and Post-Shipment Export Finance?
No, because under the classification of NKD (national classification of activities) logs belong to raw materials.
8. Does HBOR provide direct lending under the Programme Pre- and Post-Shipment Export Finance?
No, all loans are extended via commercial banks, with which HBOR concluded the co-operation agreement.
9. How long does it take to process a loan application in HBOR?
From the day when the commercial bank submits to HBOR all necessary documentation, loan application processing takes about up to 10 days.
10. If a Croatian company is the owner of a company abroad, can the Croatian company obtain a pre-shipment export loan for its company abroad?
A pre-shipment export loan can be utilised only ba a Croatian company. The same company cannot obtain a pre-shipment export loan for its subsidiary company abroad.
11. I am active in trade. I import goods from Russia, pack the goods in Croatia and export them into Bosnia. Can I obtain a loan under the programme for this activity?
For re-export activities, as in your case, HBOR does not approve a pre-shipment export loan.
Buyer credit with a bank guarantee
1. What is financed under the buyer credit with a bank guarantee and under the supplier credit?
The export of goods of Croatian origin, construction works and services.
2. When are goods considered to be of Croatian origin?
The goods are considered to be of Croatian origin if they contain the minimum of 60% of Croatian component. The certificate of origin is issued by HGK (Croatian Chamber of Economy). Depending on the importing contry, the origin is also proven with documents EUR 1 and FORM-A.
3. Does the company have to conclude an export contract with the foreign buyer?
The company can be the main deliverer and can conclude the export contract with the foreign buyer, but it can also be the sub-contractor or the deliverer of goods to a main contractor under larger projects. In such cases, HBOR finances foreign buyer only for the Croatian part in the overall transaction, although he is not in a direct contractual relation with the buyer.
4. Our company would like to participate in an international bidding procedure. The buyer conditions the insurance of finance. What should we undertake?
Contact HBOR with your application for issuing an Indicative offer to be enclosed with your bidding documents. For the Indicative offer to be issued, you need to fill in the form Information on export transaction.
5. Foreign buyer wants to buy Croatian goods on instalment, but for some reasons he cannot be the borrower. What can we propose to him?
A mercandise credit to your foreign buyer can be implemented under the Supplier credit.
6. Is it possible to finance insurance premium out of the buyer credit with a bank guarantee?
Yes, the insurance premium can be calculated into the loan principal in the amount of up to 85% of the premium. The premium can also be paid through the interest rate, which is in this case increased by a certain percentage.
7. I concluded an export contract with a foreign buyer. In 12 months I am obliged to deliver a machine under the contract. If HBOR approves financing of the mentioned transaction, when can I expect the funds to be deposited in my account? Can I utilise the funds of the approved loan for financing the production of the mentioned machine
After the approval of a loan, HBOR disburses funds on the exporter's account upon the delivery, which means that these funds are not intended for financing of production, but only the payment for export transaction. The production of machines can partly be financed out of the advance payment, which must be at least 15%.
If a machine or machinery is delivered in phases or parts, HBOR disburses funds in accordance with the agreed delivery, which means after each delivered part or finished phase. In such case, if possible, we recommend to determine the dates of the delivery in the manner that each delivery provides financial means for the production of a machine or a part which is to be delivered next.
For financing of production, you can also make use of HBOR's Pre- and Post-Shipment Export Finance Programme.
8. My company is the owner of a subsidiary company abroad which buys my products and sells them on the foreign market. Can it be a borrower under the buyer credit with a bank guarantee?
No, it is not possible to utilise this form of financing when selling goods between associated companies. For such type of co-operation, an insurance policy can be issued, which is one of the preconditons to be awarded a contract.
9. Can any bank abroad issue a guarantee or be a borrower under the buyer credit with a bank guarantee?
For those countries, for which Croatian exporters show large interest, HBOR has already made a list of acceptable banks for co-operation that can be sent to you upon request. If the commercial bank of your buyer is not on this list, it is possible, upon the submission of necessary documentation (e.g. annual reports) and after an analysis, to accept the bank as a guarantor or a borrower for a certain amount.
If your buyer is in the country for which the list of acceptable banks has not yet been formed, we will ask you to submit to us necessary documentation of its commercial bank or we will, according to our needs and possibilities, contact directly the employees of that bank or financial institution.
10. I would like to work on a project worth USD 100 million, however, only goods of value of USD 30 million is of Croatian origin. Is it possible to utilise a buyer credit with a bank guarantee?
It is possible to extend loans only for the projects with at least 60% share of Croatian goods in the project. In this case, it is possible to extend a loan up to the value of USD 50 million (loan amount USD 42.5 million – 85% of the export transaction value) for the part of the project containing Croatian goods worth USD 30 million (+ 20 million of goods of foreign origin), since in this case the proportion of 60% of Croatian share is retained (30 million is 60% of 50).
11. What is the minimum and the maximum loan amount that can be extended by HBOR?
HBOR does not define the minimum and the maximum loan amount. It depends on the concluded export transaction. The loan repayment terms (defined by the Agreements and Understandings of the Berne Union) depend on the loan amount. For example:
for a loan of USD 80,000.00, the maximum loan repayment term that we can offer is 3 years,
for a loan of up to USD 175,000.00, the maximum loan repayment term that we can offer is 4 years.
for loan of up to USD 350,000.00, the maximum loan repayment term that we can offer is 5 years.