1 Overview of GLOBAL TRADE FINANCE SOLUTIONS April 2009.

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Overview ofGLOBALTRADE FINANCESOLUTIONS

April 2009

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Responding to the crisis

• GTFP program ceiling doubled to US$ 3

billion

• Introduction and launch of the GTLP

Program with IFC’s support of US$ 1 billion

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“We, the leaders of the Group of Twenty, are committed to ensuring that….For the Multilateral Development Banks (MDBs), we have agreed to support:..Global Trade Liquidity Pool which should provide up to $50 billion of trade liquidity support over the next three years, with significant cofinancing from the private sector (as part of the global effort to ensure the availability of at least $250 billion of trade finance over the next two years). In order to reach this objective, we agreed to provide $3-4 billion in voluntary”

DECLARATION ON DELIVERING RESOURCES THROUGH

INTERNATIONAL FINANCIAL INSTITUTIONS

LONDON SUMMIT, APRIL 2, 2009

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Current Conditions and Response• Trade finance is the lifeblood of US$14 trillion annual global commerce and

one of the most fundamental engines for global trade at all stages of the supply chain, especially in emerging markets.

• Current Market Conditions: Availability of trade finance declining Despite global slowdown, growing shortfall in trade financing continues to constrain global trade Driven by scarcity of capital, increased costs and liquidity premiums, heightened risk perceptions, loss of market participants

• Swiftly aggregating resources under simple and efficient structures can enhance impact in the global markets – economies of scale and timeliness and flexibility (in both setup and wind down).

• GTLP aims to address increased risk and liquidity constraints with a funded trade support program via collaboration among Development Financial Institutions (“DFIs”) / International Financial Institutions (“IFIs’) = Program Partners

GTLP – Investment Approach

• Total mobilization from Program Partners up to US$5 billion (IFC US$1B) for potential leverage impact US$50 billion financing in developing world

• Partner with 10+ global or regional banks to channel liquidity to i) the bank’s global or regional correspondent trade network, or ii) the bank’s client network in a specific sector(s)

• Two investment structures: (i) 40:60 risk sharing - funding and risk shared between Program Partners (40%) and global/regional banks (60%); (ii) fully funded short-term loan to bank.

• GTLP is designed to fund trade transactions – limited to 270 days and self liquidating.

• IFC will act as agent for GTLP under guidelines and criteria agreed with Partners in Master Participation Agreement

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-2

GTLPAccount

IFC = Agent

GTLP Supply and Demand Overview

Issuing Bank =Local banks

DFIDFI- 1

GTLP Master SyndicationAgreement

Reg. DB IFC

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SMEs/local banks

GLOBAL

BANK

60:40 RFP

REGIONAL

BANK

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GTLP – Key Terms

• Master Syndication Agreement governs the “partnership” among Program Partners – guiding principles, representations, capital contribution

/repayment regional allocation, etc.

• Sets eligibility criteria and guidelines for selecting Utilization Banks• robustness of their trade operations to ensure acceptable credit risk• solid experience with IFC, specially under GTFP• strong geographic focus and reach• commitment to scaling up their trade operations• IFC undertakes due diligence on Utilization Banks and negotiates on behalf of Partners. • IFC provides required info to Partners to endorse credit decision.

• Capital Drawdown (IFC’s B loan model): Each Program Partner will contribute its pro-rata share to a separate GTLP escrow account

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• Administrative Expenses Establishment Fee: US$250K per Program Partner Administration Fee: 30bps of committed amounts to be billed/paid semi-

annually to IFC by Program Partners. Fees support Program structuring, due diligence and administrative costs.

Processing Agent fee: TBD. IFC will try to use existing B loan structure to minimize costs, but will involve use of GTLP Escrow Account and Processing Bank.

• Reporting IFC will provide to Program Partners quarterly and annual reports in relation to

operations financed under the GTLP including audited GTLP account reports detailing balances, disbursements/repayments/interest flows, etc.

• Strategy for Allocation by Regions Achieve wide geographical diversification consistent with GTLP objective of

reaching under-served clients globally in emerging markets Account for Program Partners’ unique geographical mandates by ensuring

their regions are covered through GTLP as a whole (e.g., GTLP aggregated funding reaches Africa, LATAM, etc)

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GTLP – Key Terms (con’t)

GTLP – Expected Reach

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1010

Next Steps For GTLP Launch

• Complete Phase I of fund raising by end of April – US$3-4B in Commitments by early May

– KFW, DEG, FMO, SIDA, Norfund, IDB, Arab Monetary Fund, Singapore, Korea, China and ADB

• Conclude Appraisal of at least four global/regional banks and present Info-Memo to participants

• First Disbursements Late May

Global Trade Finance Program

GTFP delivers risk mitigation for counter-party bank risk for trade transactions in over 70 emerging markets.

AAA Rated – Basel II benefits

Coverage up to 100%

Umbrella guarantee: covering country and commercial risk

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Program Features

• Covers private sector trade transactions

• Covers all bona fide trade finance instruments

• Covers goods in line with IFC’s exclusion list

• Structured as a Standby via SWIFT

• Payable after 15 days of claim

• Market Pricing

• Dedicated trade team with responsive service: 24 hours

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IFC Guarantees – Trade Instruments

• Import Letters of Credit

• Standby Letters of Credit

• Guarantees

IFC covers the obligation of the issuer of the performance

bonds, bid bonds, payment/ advance payment gtees

• Bills of Exchange/ Promissory Notes for Trade

IFC covers the obligation of the issuer for pre-export

financing or post-import financing extended by a

participating Confirming Bank

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GTFP Program Profile

GTFP TRANSACTIONS

Cumulative Program Statistics (as of March 2009)

• TOTAL # / US$ OF GTEES 2938 / $3.85 B

• AVERAGE TENOR 5.25 months• MEDIAN GTEE VALUE US$ 200K• TXN $ RANGE US$ 2K- 23M• TXNS< US$ 1 MIL. 75%• TOTAL RISK SHARE BY CBs 27%

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Regional Breakdown of Guarantees (US$) in FY09

SOUTH ASIA

5%

AFRICA

35%

CEU5%

EAP3%LAC

33%

MENA

23%

SECA1%

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GTFP Covers a Variety of Goods

AGRICULTURAL PRODUCTS, FERTILIZER AND

FOODSTUFF28%

INDUSTRIAL GOODS & MACHINERY

16%

IRON & STEEL9%

OIL & GAS22%

COMMUNICATIONS, EQUIPMENT & SOFTWARE

2%

PLASTIC & RUBBER3%

AUTOMOTIVE & PARTS9%

CONSTRUCTION MATERIAL AND SERVICES

2%

TEXTILES & LEATHER5%

CONSUMER GOODS4%

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147 Banks in 73 countries

Signed

In process

Issuing Bank Coverage so far…

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147 Issuing Banks in 73 countries (1)AFRICA

27 countries – 44 banks

AngolaBanco de Fomento AngolaBeninDiamond BankEcobankBurkina FasoEcobankBurundiBCBInterbankCote d’IvoireEcobankDRCRaw BankGambiaAccess BankGhanaEcobankMerchant Bank of GhanaTrust BankKenyaBarclaysI&M BankHabib Bank Ltd. Kenya Commercial BankPrime BankDiamond Trust Bank

LiberiaLBDIMadagascarBank of AfricaMalawiFirst Merchant BankMaliEcobankMauritaniaGénérale de Banque de MauritanieMauritiusHabib Bank Ltd. MozambiqueABCBDCNigerEcobankNigeriaAccess BankDiamond BankEcobankFirst City Monument Bank (FCMB)Guaranty Trust Bank (GTB)Intercontinental BankIBTCZenith

RwandaBCRSenegalEcobankSierra LeoneGuaranty Trust BankRokelSierra Leone Commercial BankSeychellesHabib Bank Ltd.South AfricaSasfin TanzaniaABCExim Bank TogoEcobankUgandaOrient BankZambiaABC

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147 Issuing Banks in 73 countries (2)

LATIN AMERICA AND CARIBBEAN14 countries – 34 banks

ArgentinaBBVA Banco Francés Banco PatagoniaBanco SupervielleBanco GaliciaBanco Itau Buen AyreBanco CMFStandard Bank ArgentinaBoliviaBanco Mercantil BrazilBIC BancoBanco Comercial Uruguai S.A.Banco Indusval SADaycovalBPN BrasilPine BankBanco SofisaBanco FibraUnibancoCosta RicaPromerica

Dominican RepublicBanco LeonEcuadorBolivarianoGuayaquilInternacionalProdubancoHaitiCapital BankHondurasBanco FicohsaMexicoMonex Financiera SANicaraguaBanco de FinanzasParaguayBanco ContinentalInterbancoBanco RegionalBBVA, ParaguayPeruBanco Interamericano de Finanzas (BiF)St. LuciaBank of St. LuciaUruguayNuevo Banco Comercial

E. EUROPE/ CENTRAL ASIA12 countries – 25 banks

AlbaniaBanka Kombetare Tregtane (BKT)ArmeniaArmeconombankAzerbaijanAzerigazbankRespublika UnibankAzerDemiryol BankBelarusPrior BankGeorgiaBank of GeorgiaBank RepublicKazakhstanBank CenterCreditBank KaspiKosovoRZB KosovoMoldovaMobias BancaRussiaATBCredit Bank of MoscowAbsolutLocko BankMDMRussian Standard BankUrsa BankUral Trans Bank

TajikistanBank EshkataBank Tajik SodirotTurkeyHabib Bank Ltd.Seker BankUkraineRaiffeisen Bank Aval

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147 Issuing Banks in 73 countries (3)

ASIA12 countries – 29 banks

MIDDLE EAST & NORTH AFRICA8 countries – 13 banks

BangladeshBRAC BankEastern BankEXIM Bank Habib Bank LtdSoutheast BankBank AlfalahBhutanBhutan National BankCambodiaACLEDAChinaBank of BeijingIndonesiaPT Bank DanamonPT Bank HanaMaldivesHabib Bank Ltd.MongoliaGolomt BankXac BankZoos Bank

AfghanistanHabib Bank LtdBank AlfalahEgyptAhli United BankLebanonBanque Libano- FrancaisFransabankBank of BeirutHabib Bank Ltd. MaltaFIMBank plc. JordanBank of JordanCapital Bank of JordanUnion BankSyria Bank of Syria and OverseasWest BankAlrafah Microfinance BankBank of PalestineArab Islamic BankYemenSaba Islamic Bank

NepalBank of KathmanduNIC BankPakistanBank AlfalahAllied BankAskariHabib Bank Ltd.Habib Metropolitan Bank SoneriMCBMeezan BankPapua New GuineaBank South PacificSri LankaCommercial Bank of CeylonHabib Bank Ltd. National Development BankNations Trust BankVietnamExim BankSacombankTechcombank

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Next phase coverage

Africa•Cape Verde•Cameroon•Comoros•São Tomé and Príncipe

Latin America and Caribbean•Colombia•Guatemala•El Salvador•Chile•Panama•Dominican Republic•Belize•St. Kitts and Nevis

Mid-East/N.Africa•Afghanistan•Iraq•Tunisia•Libya

Europe & Central Asia•Serbia•Kyrgyz Republic•Romania•Bosnia – Herzegovina•Macedonia

East and South Asia•Philippines•Lao PDR•India

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169 Confirming Banks in 76 countries- 1•ABC•ABN AMRO•Afrexim•Ahli United Bank•American Express Bank•Anglo Irish Bank•ANZ•Attijari Bank Tunisia•Attijariwafa•Aval (RZB)•BAC Florida•Barclays•Banca delle Marche Spa•Banca Popolare di Sondria•Banco Alfa de Investimento•BancoBICE•Banco do Brasil•Banco Commercial Portugues•Banco Espirito Santo•Banco Internacional del Peru S.A.A (Interbank)

•Banco Galicia•Banco Itau S/A•Bancoldex•Banco Patagonia S.A.•Banco Popolare SC•Banco Popular Espanol•Banco Português de Negócios•Banco Santander Central Hispano•Banco Sabadell•Banesto•Bank Alfalah•Bank Austria Creditanstalt•Bank AlJazira•Bank of America•Bank of Beijing•Bank of Beirut•Bank of China•Bank Danamon•Bank Leumi leIsrael Bank Muscat•Bank Mandiri•Bank of Montreal

•Bank of Nova Scotia•Bank NISP•Bank of Tokyo Mitsubishi UFJ, Ltd.•Banque de Commerce et de Placements•Banque LibanoFrancaise (BLF)•Banque Marocaine du Commerce Exterieur(BMCE)•BB&T•BBVA•BIC Banco•BHF•Banco BPI•Berliner Volksbank•BLADEX•BNP Paribas•British Arab Commercial Bank Limited•BRED•Banca Agricola Mantovana

•Byblos Bank •Caixa Catalunya•Caixa Galicia•Caixa Geral de Depósitos•Caja Madrid•Caja Mediterraneo•Calyon•CECA •Ceska Sporitelna•China Construction Bank•Citibank N.A.•CoBank•Commercial Bank of Ceylon•Commerzbank•Commonwealth Bank of Australia•Credit Uruguay Banco •Credit Suisse•Danske Bank •Deutsche Bank•Dresdner Bank•DNB Nor Bank

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169 Confirming Banks in 76 countries- 2

•DZ Bank•Emirates Bank•EFG Eurobank•Erste Bank Group•Export Import Bank of India•FIMBANK plc•First International Bank of Israel•FirstRand Bank Ltd.•Fortis Bank NV/SA•Garanti Bank•GarantiBank International N.V.•Ghana International Bank•Habib American Bank•Habib Bank Ltd. •Bank Hapoalim•Hemisphere National Bank •HSBC•HVB•ICICI•Industrial Bank, China•Interbank Peru

•ING Belgium•ING Bank N.V.•Intesa SanPaolo Spa•Itaú BBA•JP Morgan Chase•KeyBank •KBC•Korea Exchange Bank•LaCaixa•LBBW•Lloyds TSB•London Forfeiting•Mashreqbank•Mauritius Commercial Bank•Medicapital Bank•Minsheng•Mizrahi Tefahot Bank•Mizuho Corporate Bank•Monex•M&T Bank•NATIXIS•National Bank of Dubai•National Bank of Fujairah•National Bank of Kuwait

•National City•Nedbank•Nordea•Nord/LB•OCBC Bank•OTP Ukraine•Promsvyazbank•Pohjola Bank•Rabobank•RZB•Royal Bank of Scotland•Regions Bank•SEB•Sekerbank•Silicon Valley Bank•Societe Generale•Sovereign Bank•Standard Bank Plc•Standard Bank South Africa•Standard Chartered Bank•Sterling Bank

•Sumitomo Mitsui•Svenska Handelsbanken•Swedbank•The Bank of New York•TorontoDominion Bank•Total Bank•Turkiye Ekonomi Bankasi (TEB)•Turkiye Is Bankasi•U.B.A.F.•Unibanco•UBS•Ukrexim Bank•Ukrsibbank•UniCredit•U.S. Bank•Vakifbank•VTB Bank (France) SA•Wachovia•WestLB•Westpac•Whitney National Bank•Yapi Kredi •Zurcher Kantonalbank

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169 Confirming Banks in 76 countries

1. La Caixa

2. JP Morgan Chase

3. BNP Paribas

4. Commerzbank

5. Standard Chartered

6. Deutsche Bank

7. Wachovia

8. Commonwealth

9. Intesa Sanpaolo

10. Citibank

11. BPI

12. Scotiabank

13. SMBC

14. ANZ Bank

15. LBBW

16. UBS

17. Fortis

18. Bank of Montreal

19. Zürcher Kantonalbank

20. KBC

Top Confirming Banks in FY09 (US $)

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Typical GTFP Transaction: Import LCs

IFC Guarantee

Goods

ExporterInternational

Bank(Confirming)

Payment

Importer

InternationalFinance

Corporation

Confirm

L/C

Documents

Request

L/C Issuance

Payment

Documents

Payment

Documents

LocalBank

(Issuing)

L/C in favor of exporter

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Trucks from USA to Nigeria

• LC issued by a Nigerian Bank

• Confirmed by a US Bank

• Tenor: 7 months

• Value: $10M

• IFC Covers 33%

USANigeria

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Cotton from USA to Bangladesh

• LC issued by a Bangladeshi Bank

• Confirmed by a US Bank

• Tenor: 8 months

• Value: $1.4M

• IFC Covers 64%

USABangladesh

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Pre-Export Financing

IFC Gtee

Goods

ImporterInternational

BankExporter

Pre-export Financing Pre-export Funding

LocalBank

Request

Pre-export Advance

SBLC/ PN for

Pre-export Funding

RequestIFC Gtee for Pre-Export

Loan

InternationalFinance

Corporation

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US $10 Mil US $10 Mil

Prom NotesProm Notes

100% Gtee100% Gtee

Pre-export Financing: Parafin from Argentina to Chile

AmericanBank

AmericanBank

Argentina Chile

ArgentineBank

ArgentineBank

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US $150K US $150K

Prom NotesProm Notes

100% Gtee100% Gtee

Pre-export Financing: Wheat from Brazil to Uruguay

FrenchBank

FrenchBank

Brazil Uruguay

BrazilianBank

BrazilianBank

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GTFP: Post-Import Financing

4. IFC Guarantee

Goods

ExporterInternational

Bank(Confirming)

Importer

InternationalFinance

Corporation

5. Discounts LC docs without

recourse

LC Documents

1. Accepts LC docs for

payment on due date

6. $$ on due date 7. $$ on due date

LC Documents

LocalBank

(Issuing)

Unconfirmed Usance L/C in favor of exporter

2. Acceptanceof LC docs

3. Request for IFC Gtee for post-import acceptance

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• Promissory Note issued by a Nicaraguan Bank

• Funded by an American Bank

• Tenor: 4 months

• Value: $ 750K

• IFC Covers : 75%

Post-import financing: cars from Singapore to Nicaragua

Singapore

Nicaragua

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Successful Transactions - Examples

ArgentinaLetter of CreditSoyabean oil to MadagascarConfirming Bank in UK Tenor: Up to 6 months US $1.6 million (100%)

Spain

Letter of Credit

Ceramic tiles to Jordan

Confirming Bank in Spain

Tenor: Up to 6 months

US$ 0.45 million (100%)

Mongolia

Letter of Credit

Tractors from USA

Confirming Bank in USA

Post-import financing for 2 yrs

US$ 0.9 million (100%)

Kazakhstan

Letter of Credit

Baby food from Switzerland

Confirming Bank in Canada

Tenor: 12 months

US$ 4.8 million (100%)

Morocco

Letter of Credit

Fertilizer to Bangladesh

Confirming Bank in USA

Tenor: Up to 6 months

US$ 0.9 million (62.9%)

Brazil

Post-import financing Plastic utensils to Paraguay

Confirming Bank in Spain

US$ 0.19 million

Lebanon

Irrevocable Reimbursement Undertaking

Construction Machinery

Confirming Bank in Austria

US$ 11 million (85%)

Jordan

Standby LC

Construction Project in UAE

Confirming Bank in UAE

Post-shipment export financing

US$ 7.5 million (100%)

Thailand

Letter of Credit

Rice to Nigeria

Confirming Bank in USA

Tenor: Up to 6 months

US$ 1.3 million (100%)

Pakistan

Letter of Credit

Fertilizer from Tunisia

Confirming Bank in UK

Tenor: 6 months

US$ 7.2 million (70%)

Yemen

Letter of Credit

Rice from Pakistan

Confirming Bank in Germany

Tenor: 6 months

US$ 0.75 million (100%)

South Africa

Letter of Credit

Coal from South Africa to Pakistan

Confirming Bank in USA

Tenor: Up to 6 months

US$ 4.8 million (100%)

Lebanon

Bid Bond

Construction Project in Qatar

Confirming Bank in UAE

Tenor: 3 Months

US$ 2.7 million (85%)

Nigeria

Performance Bond

Supply of methanol (5 Mths)

Confirming Bank in South Africa

US$10 million (100%)

Sierra Leone

Letter of Credit

Telecom Cables from Spain

Confirming Bank in Spain

Tenor: 3 Months

US$ 0.39 million (100%)

Malta

Discount against Acceptance of LC dox (Third Bank LC)

Machines to West Africa

Confirming (Discounting) Bank in China

US$ 0.3 million (100%)