UK Export Finance: annual report and accounts published
UK Export Finance provided £2.3 billion of support for UK exports in the year ending 31 March 2014.
UK Export Finance, the UK’s export credit agency, provided £2.3 billion of support to UK exporters to help businesses achieve sustainable growth in the financial year 2013 to 2014.
The support, detailed in UKEF’s Annual Report and Accounts, showed an increase from £0.4 billion to £1.3 billion for civil exports, alongside its continuing support for the sale of Airbus aircraft overseas.
UKEF has significantly increased the number of cases and the range of support it provides. While the value of the business supported in the preceding year was higher at £4.3 billion, this was dominated by a single £2 billion defence case (note: periodically, large or one-off defence contracts have tended disproportionately to impact UKEF figures). In contrast, no single case dominated to such an extent this year. Support was spread across a wider variety of exporters selling to more overseas markets, with more individual guarantees and policies issued.
| 2013-14 | 2012-13 | |
|---|---|---|
| Total business supported (£m) | 2,272 | 4,295* |
| Civil business, excluding aerospace (£m) | 1,310 | 445 |
| Number of guarantees and policies issued | 619 | 368 |
| Number of countries | 71 | 58 |
| Number of exporters | 130 | 84 |
*This included a single £2 billion defence case.
Supporting exports, protecting the taxpayer
UKEF is mandated to operate at no net cost to the taxpayer. It earned premium income of £120 million, while paying claims of £13 million. It recovered £135 million owed as a result of past defaults on UKEF-guaranteed loans.
Its support benefited a wide range of industries, including automotive, petrochemical, oil and gas, construction and utilities.
Individual support per case ranged from £10,000 to £500 million, with the size of exporting companies supported ranging from micro to multinational.
Support included a US$700 million loan in respect of the Sadara refinery in Saudi Arabia, the largest limited recourse project financing that UKEF has ever supported. The report lists all the guarantees and insurance policies issued.
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Non-financial support was also provided by its network of Export Finance Advisers, which increased in number from 18 to 21 in the year.
UKEF has recently announced new plans to increase the competitiveness of its support, including an enhanced ability to lend directly to overseas buyers of UK goods and services.
There is a strong pipeline of business for the year ahead, as UKEF steps-up its marketing both in the UK and overseas. Furthermore, UKEF is becoming more agile and proactive in its support for UK exports. For more information read its business plan for 2014 to 2017.
Financial overview - five-year summary (£m)
| 2013-14 | 2012-13 | 2011-12 | 2010-11 | 2009-10 | |
|---|---|---|---|---|---|
| Business supported | 2,272 | 4,295* | 2,318 | 2,924 | 2,206 |
| Premium income | 120 | 133 | 85 | 96 | 58 |
| Claims paid | 13 | 7 | 6 | 30 | 48 |
| Net operating income | 50 | 135 | 147 | 204 | 272 |
*This total included support for a one-off £2 billion defence deal.
The reduction in net operating income for the year was largely caused by a reduction in the release from underwriting funds closed in the year, a reduction in the release of provisions for recoverable claims, decreased interest income from underwriting activities, and foreign exchange changes. For full details read the Directors’ Report on page 69 of the Accounts.
Analysis: support by product used (£)
Analysis: support by product used (no. of exporters supported)
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