Financial engineering - The Coseam Italia SpA value added for an integrated supply package

Being competitive in terms of technology and cost is not always enough for penetration on foreign markets – these factors have to be backed up by an attractive financial package.

The Consortium has therefore decided to acquire specialist competencies in financial engineering services to support its construction sector.

While tailor-made solutions are developed for the most complex cases, the main instruments offered are:

Export credit

Italian Legislative Decree 143/98 allows foreign customers to be offered medium-long term payment packages at low interest rates and on special conditions. Under this scheme, the public body SIMEST pays part of the interest on loans granted by Italian or foreign banks for the supply of Italian goods and services.

The loan covers up to 85% of the invoice amount, while the purchaser must make a down payment of at least 15%.

The loan covering 85% of the price is granted at the special CIRR rate, while the conditions and procedures for payment of the subsidy vary depending on the form of loan agreed (Supplier Credit or Purchaser Credit).

Project Financing

Long-term financing arrangements used for complex projects such as the realisation of public infrastructures.

Project financing operations may vary widely, with different versions of the following basic types of scheme:

  • B.O.T. (Build, Operate and Transfer): the infrastructure is built, operated and finally transferred;
  • B.O.O. (Build, Operate and Own): the infrastructure is built and operated, and ownership is retained;
  • B.O.O.T. (Build, Operate, Own and Transfer): the infrastructure is built and operated and ownership is retained for a specific period of time before final transfer.

Discounting of bills without recourse

Financial service which discounts, without recourse, promissory notes, bills of exchange and letters of credit the exporter receives from a foreign customer. In the management of these financial instruments, Coseam Italia SpA also works through the opening and confirmation of letters of credit, and the negotiation of bank and/or sovereign guarantees.

 

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