IFC enhances FimBank's trade facility to $20 million

The International Finance Corporation, a subsidiary of World Bank, has approved to increase FimBank's trade facility in its Global Trade Finance Programme by an additional $10 million to $20 million.

The GTFP was launched in 2005 to support the development of trade with and between emerging economies. Under the $500 million programme, IFC offer full or partial guarantees to confirming banks participating in the GTFP, effectively taking on the payment risk of issuing banks in emerging countries. The GTFP guarantees are transaction specific, and apply to letters of credit, promissory notes, bills of exchange, bid and performance bonds, advance payment guarantees and suppliers' credit for the importation of capital goods.

FimBank's status as both a confirming bank and an issuing bank implies that it benefits from both sides of the programme. If so required, IFC is willing to issue its guarantees to other banks to cover the risk of FIMBank. Alternatively, FimBank can also benefit from IFC's guarantees when confirming letters of credits issued by banks in emerging countries.

Margrith Lütschg-Emmenegger, FimBank's president, expressed her satisfaction with this development: "The IFC is placing a great deal of trust in FIMBank. This is a show of confidence in both the Bank and in Malta. This, together with the recent affirmation of FimBank's rating by Fitch, goes to prove the solid foundation of FimBank and its activities which are impervious to the current events in the financial markets," she said.