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February 27, 2018updated 26 Feb 2018 3:50pm

HSBC makes first use of UKEF bank underwriting scheme

HSBC has funded £500k of ventilation equipment for Hull-based supplier North Sea Ventilation (NSV) to Nigeria LNG, an overseas energy company, with a bond guarantee on the deal by UK Export Finance (UKEF).

By Brian Cantwell

HSBC has funded £500k of ventilation equipment for Hull-based supplier North Sea Ventilation (NSV) to Nigeria LNG, an overseas energy company, with a bond guarantee for the deal by UK Export Finance (UKEF).

NSV supplies heating, ventilating, air-conditioning and refrigeration systems for the energy sector. Established in 1992, it has a £9m turnover and 80% of its sales are overseas.

Under the terms of the contract between NSV and HSBC, NSV agreed to provide a 50% advance payment to provide project funding in the early stages of NSV’s manufacturing process.

NSV had to provide an advance payment guarantee through HSBC that was beyond the credit arrangements agreed between HSBC and NSV, so UKEF stepped in to provide the required £250k.

UKEF said in the past, this process would have involved NSV and HSBC submitting another application to UKEF, with UKEF undertaking parallel due diligence and approvals to those HSBC will already have undertaken. This would have added days or even weeks to the process, said UKEF.

This is the first use of UKEF’s partnership with five high street banks to allow smaller exporters to access government-backed trade finance support directly from their bank. This means that, where previously it could take weeks in addition to the banks’ own turnaround times to access this support, it will now take a matter of seconds where the transaction is eligible.

John Parker, finance manager at NSV said: “Working with HSBC and UKEF has provided NSV the flexibility to realise export opportunities, securing larger contracts than we could otherwise be confident we could fulfil, and the new application process couldn’t have been simpler: less paperwork, quick turnaround and a positive decision.”

Neil Waterhouse, senior business manager, HSBC said: “Working with UKEF has helped us help our customer. With this support, NSV’s exports are going from strength to strength. Our new partnership with UKEF means that we’re able to make the process as quick and easy as possible – for the customer and for us.”

Jana Horvath-Pocciova, export finance manager, UKEF, said: “We’re delighted to be supporting world-leading suppliers like North Sea Ventilation as they grow their international reputation for quality, reliability and customer service. With this new bank partnership making it easier for SME exporters like these to access the finance they need to export, we hope to help even more in the future.”

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