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An agreement signed by UK Export Finance (UKEF) will help to open up markets in Mexico to UK exporters.
The Addendum to a Memorandum of Understanding (MOU) between UKEF and Bancomext (Mexican Trade Development Bank) is intended to promote further co-operation between the two organisations.
The agreement was signed by UKEF Business Group Director, Steve Dodgson and Bancomext Deputy General Director Finance Miguel Siliceo Valdespino. It follows a visit to Mexico City by senior UKEF senior officials, exploring the potential to work together on a Direct Lending basis. The intention to do this is set out in the extension to the existing MOU.
Crucially, should Bancomext join UKEF’s existing panel of 20 financial organisations approved to partner the UK’s export credit agency in delivering its Direct Lending Facility (DLF), UK exporters to Mexico could benefit from a £3 billion direct source of credit for the Mexican marketplace. The £3 billion facility is designed to help overseas buyers purchase goods and services from UK exporters.
Partner financial organisations on the DLF panel must meet demanding criteria covering their competence, capabilities, and level of expertise and experience in performing the services that underpin the arrangement and administration of specialised export credit finance.
Commenting on the importance of the MOU, UKEF Director, Steve Dodgson said:
We are delighted to seal this agreement, which will help to maximise the opportunities for UK exporters in Mexico’s markets. Our Direct Lending Facility also has an important role to play. Panel members cover a wide range of overseas markets, with complementary geographical strengths that will make it easier for UK companies to arrange competitive loans throughout a worldwide network. That reach will increase UKEF’s capacity to lend to overseas buyers of UK products and services.
During the last five years UKEF has provided over 1,500 guarantees and insurance policies with an exposure value in excess of £14 billion.
UKEF supplements the financial support for exporters from the commercial sector and enables banks and other financial institutions to help more customers take advantage of international sales. Under the DLF, UKEF will provide loans to overseas buyers in order to finance the purchase of goods and services from UK exporters. Loans are available to cover new international sales by any business exporting from the UK, to any country where UKEF medium term cover is available, and can be made in Sterling, US Dollars, Euro or Japanese Yen.
Notes for Editors
UK Export Finance is the UK’s export credit agency. It supports long term economic growth and competitiveness by complementing the private market with insurance for exporters, loan guarantees to banks, and support for and provision of loans to overseas buyers of UK goods and services.
Sectors in which UKEF has supported exports include: aerospace, petrochemicals, construction, oil and gas, mining and metals, telecommunications, and transport.
The enhanced DLF was announced by the Chancellor of the Exchequer in March 2014 and many transactions are under active consideration. These transactions range in value from £5 million to over £500 million.
Direct Lending Facility panel members include:
- Australia and New Zealand Banking Group
- Banco Santander
- Bank of China
- Barclays Bank Group
- Cargill Inc/Cargill Financial Services International
- Citibank NA
- Crown Agents Bank
- Deutsche Bank
- Ecobank Nigeria
- HSBC Bank Group
- Investec Bank
- JPMorgan Chase Bank Group
- Lloyds Banking Group
- NorthstarTrade Finance/Sovereign Star Trade Finance
- Societe Generale
- Standard Chartered Bank
- T. Garanti Bankasi
- The Bank of Tokyo-Mitsubishi UFJ
- The Royal Bank of Scotland Group
- UKEF has a regional network of Export Finance Advisers supporting export businesses.
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