Export-Import Bank of Malaysia Berhad (MEXIM)

Institution type  Export Credit Agency
Ownership  100% owned by the Ministry of Finance
Head Office  Export-Import Bank of Malaysia Berhad (357198-K) Level 1, Exim Bank, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia
Rating  Moody's A3, Fitch A-
Major instruments  Conventional banking, Islamic banking, export finance (medium and long term guarantees), short-, medium- and long-term insurance/takaful, bonds and guarantees
Information   http://www.exim.com.my
email : communication@exim.com.my
Tel: (+063) 2601 2000

Summary
Founded in 1995, Export-Import Bank of Malaysia Berhad (Exim Bank of Malaysia or MEXIM) is a wholly state owned Malaysian export credit agency and   member of Berne Union, ADFIAP,Aman Union and AEBF. MEXIM ismandated to promote Malaysian investment and exports in priority sectors such as capital goods, infrastructure projects, shipping or value added manufactured products. MEXIM plays the role in financial assistance for domestic companies to enter new markets abroad.Besides banking facilities,MEXIM provides a broad range ofinsurance/takaful products including trade credit insurance/takaful, political risk insurance or overseas investment insurance/takaful to cover exporters and investors against political and commercial risks.

List of MEXIM products :

Short Term Credit Insurance/ Takaful

  • Trade Credit Insurance/Takaful (Export/Domestic/Import)
  • Bank Letter of Credit Policy
  • Bank Trade Credit Takaful
  • Multi Currency Trade Financing Scheme
  • Indirect Exporters’ Financing Scheme
  • Bankers Trade Credit Insurance (BTCI)

 

Medium-Long Term Credit Insurance/Takaful

  • Political Risk Insurance (PRI)
  • Overseas Investment Insurance/Takaful
  • Specific Policy (Contract/Constructional Works/Services)
  • Buyer Credit Guarantee
  • Bond Risk Insurance

Example of relevant products for private infrastructure investments
Instrument Political Risk Insurance (PRI) / Takaful
Instrument type  Insurance / Takaful
Eligible investments, customers, and projects  Malaysian companies / contractors, as well as Malaysian investors raising funds overseas
Eligible beneficiaries Lenders/financiers private sector companies
Eligible forms of investment Equity  shareholder advances, shareholder guarantee, commercial bank loans / financing, movable assets
Risk types covered • Transfer restriction
• Expropriation
• War and civil disturbance
• Breach of contract
Maximum tenor Medium/Long-term Coverage up to a maximum of 15 years
Maximum amount or cover  covers up to 90% of losses
Fees and Premium/Contribution  Processing fee of 1.0% of insured amount subject to minimum RM1,000 and maximum of RM20,000 (or foreign currency equivalent)payable upon accepting Letter Offer. (applicable to non-SMEs))
Premium/contribution is calculated based on the Risk Based Pricing Model (RBPM) and payable in advance on a one-off basis in Ringgit Malaysia equivalent.
Instrument  Specific Policy (contracts / constructional works/ services) / Takaful
Instrument type  Insurance / Takaful
Eligible investments, customer, and projects  Malaysian exporters who undertake contracts for export of capital goods, or turnkey project, or construction works, or rendering services abroad or local, against the risk of non-payment by the overseas buyer / Malaysian buyer. (Local project or Malaysian buyer must have export element).
Eligible beneficiaries Lenders/financiers private sector companies
Eligible forms of investment  Contracts that are:
i. A one-off project / contract but may be repetitive in nature project or revolving during the contract period.
iii. Lengthy in terms of manufacturing/project period

Risk types covered :
• Commercial (buyer’s insolvency, default in payment, others)
• Economic risks (blockage or delay in transfer of payment, imposition of import and export restriction, cancellation of import license)
• Political risks ( war\, revolution or other similar civil disturbances in the buyer’s country)
Maximum tenor  Medium / Long-term Coverage up to a maximum of 15 years
Maximum amount or cover  Up to 90%
Fees and Premium/ contribution Processing fee of RM1,000 per application or foreign currency equivalent. (applicable to non-SME’s)
Premium / contribution is calculated based on the Risk Based Pricing Model (RBPM) and payable in advance on a one-off basis in Ringgit Malaysia equivalent.
Other conditions  Premium / contribution rates primarily depend on EXIM Banks grading of the market with which the business is done and terms of payment. In general, the premium / contribution is dependent on market risk and credit terms.
Instrument Bond  Risk Insurance
Instrument type  Insurance
Eligible investments, borrowers, and projects  Malaysian contractors
Eligible beneficiaries  Lenders, private sector companies
Eligible forms of investment  Bonds
Risk types covered  i. Unfair calling by government / public buyer
ii. Unfair calling by private buyer (selective cases)
iii. Fair calling, but following political impediments:
– Import/Export Restriction – contractor is unable to fulfill its obligations under the contract caused by:
– The implementation of any law or of any order, decree or regulation of having the force of law, which in circumstances outside the control of the contractor, prevents the import/rendering of the goods/services specified in the contract, or
– The cancellation, in circumstances outside the control of the contractor, of a previously issued and currently valid authority to import/render the goods/services specified in the contract.
– War – contractor is unable to fulfil its obligations under the contract caused solely and directly by the frustration of the contract or termination due to the occurrence within the country of the principal, of war, civil war, insurrection, rebellion and/or revolution which directly prevents the due performance of the said contract in whole or in part.
Maximum tenor  5 years
Maximum amount or cover  Up to 90% of losses
Premium  Premium rates primarily depend on EXIM Bank’s grading of the market with which the business is done and terms of payment. In general, the premium is dependent on market risk and credit terms.