Export Finance and Insurance Corporation (EFIC) has guaranteed two advance payment bonds to support a new contract secured by Sydney-based exporter Bronx International Pty Ltd in Turkey.
The advance payment bonds were issued by St.George Bank as security for advance payments made to Bronx International under the contract.
EFIC is the Australian Government’s export credit agency supporting Australian export companies in developing their business overseas.
Bronx International, a specialist in providing galvanising and paint lines has won a contract for approximately A$6.5 million to supply and install a colour coating line for sheet metal for Alcoat Metal Boyana san.tic AS, a subsidiary of Sistem Metal A.S., a Turkish manufacturer of advertising boards and signs.
St.George Bank has issued two advance payment bonds to the Turkish buyer as security for advance payments made to Bronx International under the export contract.
EFIC’s guarantees to St.George cover 80 per cent of the face value of the two bonds and amount to A$356,000 and £98,000 respectively with expiry in December 2011.
EFIC has guaranteed the St.George bonds under an existing bonding line with Bronx International that has earlier covered Bronx International’s contracts in Ukraine and Argentina.
Rod Sawyers, managing director of Bronx International says that EFIC’s bonding line allows them to bid for new overseas contracts with the confidence that they can meet their customers’ bonding requirements if needed.
He adds that EFIC’s support means they do not have to provide full cash security for the value of the bonds, freeing up their working capital to deliver their overseas contracts.
According to Andrea Govaert, EFIC’s Executive Director, SME, demand for bonding facilities from SME exporters remains strong, particularly in the construction and manufacturing sectors.
She adds that EFIC’s bond facilities help Australian companies such as Bronx International compete more effectively in global markets.
Speaking on St.George’s close association with Bronx International and EFIC Bank on the Turkey project, Senior Trade Finance Manager of the bank Darren Morris said that it reflected their willingness to assist customers with innovative funding solutions to suit their individual needs.