empower your business 1 investing in kazakhstan with sace fabio fritelli october 2007

EMPOWER YOUR BUSINESS 1

Investing in Kazakhstan with SACEFabio Fritelli

October 2007


SACE Group

Credit insurance, reinsurance, investments protection and advanced financial solutions

Credit insurance, reinsurance, investments protection and advanced financial solutions

Short-term insurance services both in domestic and foreign markets.

Short-term insurance services both in domestic and foreign markets.

Leader in surety business, specifically in the construction industry

Leader in surety business, specifically in the construction industry


A strong financial partner

Rating (Moody’s) Aa2

Equity € 5,734 mln

Net profit € 510.1 mln

Gross written premiums € 240.5 mln

Outstanding€ 31,979.9

mln

Key figures 2006


SACE exposure: sectors

Other Sectors33%

O il&Gas19%

ChemicalPet rochemical

15%

Steel12%

Banks14%

Power7%

Strong experience in Oil&Gas sector


Open (with conditions)Open

Off cover

SACE’s Terms of Cover in CSI Countries

RUSSIA

GEORGIA

ARMENIA

AZERBAIJAN

UZBEKISTAN

TURKMENISTAN

KAZAKHSTAN

TAJIKISTANKYRGYZISTAN


Kazakhstan

Rating

OECD

Sovereign/Bank/Corporate Risk: Open

Sovereign/Bank/Corporate Risk: Open

SACE CoverPolicy

Country Category 4/7 Country Category 4/7

S&Ps: BBB Moody’s: Baa3 Fitch: BBB

S&Ps: BBB Moody’s: Baa3 Fitch: BBB


KazkommertsbankBank Turan AlemATF BankHalyk Saving Bank of KazakhstanAlliance Bank JSCAstana Finance JSCCJSC Development Bank of

KazakhstanKazakhstan Investment FundAlfa Bank KazakhstanBank CaspianBank CentercreditDevelopment Bank of KazakhstanEurasian BankNurbankTemirbankTsesnabank

KazkommertsbankBank Turan AlemATF BankHalyk Saving Bank of KazakhstanAlliance Bank JSCAstana Finance JSCCJSC Development Bank of

KazakhstanKazakhstan Investment FundAlfa Bank KazakhstanBank CaspianBank CentercreditDevelopment Bank of KazakhstanEurasian BankNurbankTemirbankTsesnabank

SACE vs Bank Sector in Kazakhstan

Main Financial Institutions positively

assessed for SACE support

Total Current SACE Exposure euro 47 M approx.euro 47 M approx.

Maximum available exposureMaximum available exposure euro 490 M approxeuro 490 M approxeuro 490 M approxeuro 490 M approx


Why SACE: benefits

Competitiveness Longer payment terms for the buyers

Security Transfer of risk

Liquidity Credits monetization at competitive costs

Protection Safeguarding your investments and credits abroad

Stability Improvement of your balance sheet composition


Why SACE: Basel II

Cost of funding based on company credit rating Increased company transparency and disclosure of business information

Cost of funding based on company credit rating Increased company transparency and disclosure of business information

Basel II effects

Zero weight for loans guaranteed by SACE

Boost borrowing power

Zero weight for loans guaranteed by SACE

Boost borrowing power Role of SACE

With Basel II fund raising is more difficult for companies withoutan investment grade

With Basel II fund raising is more difficult for companies withoutan investment grade


(*) Such threshold is reduced to 10% for listed companies.

SACE has widened its eligibility criteria:

SACE is now able to provide cover for the financing of:

supply contracts signed by an Italian company;; or

supply contracts signed by a foreign company participated for at least 20%* by an Italian company, or

Italian origin supplies under contracts signed by a non-Italian company, and

local costs, in application of OECD Regulation Framework

Italian origin of goods is not an eligibility requirement, as SACE could cover all goods/services (of Italian, EU, or extra EU origin) provided under such contract

SACE Range of Activities: 1) Export Related Products


(*) Participated at least 20% by an Italian companies. Such threshold is reduced to 10% for listed companies.

Investments made by Italian companies / Italian subsidiaries (*)

Transactions of “strategic interest” for the Italian economy:

Strategic imports (power, gas, oil, raw materials for re-exports);

Strategic foreign customers/partners to Italian companies in their activities abroad;

Infrastructures (including domestic infrastructures) supporting: (a) the internationalization of the Italian economy (terminals, railways, roadways, etc), or (b) diversification of energy sources for the domestic market (pipelines, regasification plants, etc);

Internationalization of Italian banks;

Employment and economic growth in Italy;

Strategic industries: renewable energies, environment, technological innovation

Investments made by Italian companies / Italian subsidiaries (*)

Transactions of “strategic interest” for the Italian economy:

Strategic imports (power, gas, oil, raw materials for re-exports);

Strategic foreign customers/partners to Italian companies in their activities abroad;

Infrastructures (including domestic infrastructures) supporting: (a) the internationalization of the Italian economy (terminals, railways, roadways, etc), or (b) diversification of energy sources for the domestic market (pipelines, regasification plants, etc);

Internationalization of Italian banks;

Employment and economic growth in Italy;

Strategic industries: renewable energies, environment, technological innovation

SACE Range of Activities: 2) Non-Export Related Products


Credit Insurance

• Coverage up to 100% for political and commercial risks

• Financing up to 100% of premium amount and IDC

• Tied or multitied financing / refinancing of import transactions

FinancingBank

Italian Companie

sExport ofgoods/services

Payment ofexported

goodsForeign Entities

Insurance policy

Reimbursement

Main Features

SACE

Italian Companie

s

Foreign Entities

Export of goods and services

Payment of exported

goods

Insurance policy

Foreign subsidiar

y

SACE

• Coverage up to 100% for political and commercial risk

• Monetisation of assets through assignment of the insurance policy to a financial institution on a pro-soluto basis

(I) Buyer Credit(I) Buyer Credit (II) Supplier Credit(II) Supplier Credit


PRI: Capital contribution abroad

Structure

GuaranteeCapital

contribution / Financing

Italian Company

Foreign Company

(Recipient)

A

Controlling Stake

Capital contribution /

Financing

Foreign Subsidiary

Italian Company

Guarantee

Foreign Company

(Recipient)

B

• Coverage including capital contributions, capital goods and others, or subordinate loans and guarantees

• Financing of foreign investments also by assigning the insurance policy to a bank

• Coverage up to 100% of the investment value as a consequence of a political event

• Eligibility for investments via foreign vehicle/holding

Main Features

SACE SACE


Financial Credit Insurance: Cross Border Investment & Preshipment Facilities(*)

Structure

• Financing linked to internationalisation of the Italian economylinked to internationalisation of the Italian economy• First demand guarantee in favour of the funding bank• Risk participation with the funding bank, on a % to be agreed, against non-payment risk• Release of the bank’s regulatory capital• Freeing up borrowers credit lines• More competitive borrower’s all-in cost of funding

Pricing: participation fee paid by the funding bank to SACE on an up front / running basis

Guarantee

Funding

Italian related business

Italian entities and /or Foreign SubsidiariesBanks

Main Features

Guarantee

Italian Entities

Italian Related Business

Banks

Working Capital financing

(I) Cross Border Invest. Facility(I) Cross Border Invest. Facility (II) Pre - Shipment(II) Pre - Shipment

CapitalMarkets

Funding

SACE SACE


Commitment: €230 mln

Supplier: Danieli & Officine Meccaniche S.p.a.

Buyer: OMK Steel (Russia)

Country: Russia

Structure: Strcutured Finace

Commitment: € 1 bln

Insured: Italcementi S.p.a.

Beneficiary: Ciments Francais

Country: Egypt, India, Kazakhstan, Thailand

Structure: Investment Policy

Commitment: € 50 mln

Exporter: Ansaldobreda S.p.a

Beneficiary: DSB- Material

Country: Denmark

Structure: Surety Bond

Commitment: $ 1.2 bln

Insured: Bond Issued by Gazprom

Supplier: Snam,Saipem,Ilva,Nuovo Pignone

Country: Russia

Structure: Structured Finance Guarantee

Credentials


www.sace.it


This presentation has been prepared solely for information purposes and should not be used or considered as an offer to sell or a solicitation of an offer to buy any insurance/financial instrument mentioned in it.

The information contained herein has been obtained from sources believed to be reliable or has been prepared on the basis of a number of assumptions which may prove to be incorrect and, accordingly, SACE does not represent or warrant that the information is accurate and complete.

Disclaimer

empower your business 1 investing in kazakhstan with sace fabio fritelli october 2007

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