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ESTONIAN RURAL DEVELOPMENT FOUNDATION Rain Vändre Member of the Board. A BANKER is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain. Mark Twain RURAL DEVELOPMENT FOUNDATION - PowerPoint PPT Presentation
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ESTONIANRURAL DEVELOPMENT FOUNDATION
Rain VändreMember of the Board
A BANKER is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain.
Mark Twain RURAL DEVELOPMENT FOUNDATIONis a partner who lends you his umbrella for sun and rain.
HISTORY
Rural Life Crediting Foundation (1993)
+
Rural Credit Guaranty Fund (1997)
=
Rural Develompent Foundation (2001)
ABOUT US
The Foundations rights of establishment areexecuted by Ministry of Agriculture.
The purpose of the Foundation is to supporteconomic development in Estonian rural areasby executing specific support programs.
The activity of the Foundation enables to retain rural areas employment and to improvesustainability of rural entrepreneurs.
STRUCTURE
credit committeeup to 5 members
secretary
customer service legalservice
accountingand financial service
management boardup to 3 members
supervisory board7-15 members
Minister of Agriculture
DECISION COMPETENCE
• Credit Committee of Management Board decides on projects up to 130 000 EUR and makes proposals on projects over 130 000 EUR to Supervisory Board.
• Supervisory Board decides on projects up to 1 600 000 EUR.
BUDGET 2006
REVENUE 1,531 mEURInterest income 1,508 mEUR incl Interest income from loans 1,2 mEUR
Revenue from guarantees 240 947 EUROther incomes 22 561 EUR
EXPENSES 1,36 mEURAllowance for loan losses 319 558 EURMaintenance expenses 624 353 EUR Other reserves 83 470 EUR
Result of the financial year 172 561 EUR
BALANCE SHEETS 31.12.2004
ASSETS EUR
Cash at bank 6 581 499Loans 31 273 828Allowance for loan losses - 1 016 539Other receivables and prepayments 81 355Fixed assets 13 226
TOTAL ASSETS 36 933 368* EUR/EEK
15,6466
BALANCE SHEETS 31.12.2004LIABILITES AND EQUITY EUR
Debts 51 673Guarantee reserve 1 984 686Total liabilities 2 199 710Owners`equity 33 012 041Result for the financial year 1 191 799Total owners´equity 34 733 657
TOTAL LIABILITES AND EQUITY 36 933 368 * EUR/EEK
15,6466
STATEMENTS OF REVENUE AND EXPENDITURE 31.12.2004
Total revenue 3 282 205
Total expenses 2 074 758
Result for the financial year 1 191 799
* EUR/EEK 15,6466
GUARANTEES
Our activity takes place on a self- supporting basis, i.e that the income earned by the RDF covers all the costs connected to the activity.The extent of the guarantee issued by the RDF was increased up to 75% based on the Rural Development and Agricultural Market Regulation Act.The liability of the Foundation arising from a guarantee/suretyship instrument extends only to the debtor’s principal monetary obligation and supplements the debtor’s liability.
What is the core principle behind the guarantee?
The primary liability of the entrepreneur lies with the loan – the loan is secured by the entrepreneur’s property.
By providing a guarantee, RDF assumes secondary liability. If the entrepreneur’s business plan proves unsuccessful and the loan cannot be serviced, the property set as collateral to the loan will be realised in the first order.
If the proceeds from the disposal of the collateral prove insufficient for covering the bank’s claims, RDF will disburse the guarantee to the bank.
GUARANTEES
Loan amount guaranteed by RDF cumulated from 1997 to 2005 (in million EUR)
0 3 7
37
55
72
86
103
19
0 2 410
1726
3441
50
0
20
40
60
80
100
120
Loan
Guarantee
* withdrawal from 1997 to 2005 - 2,39% (1,2 mEUR)
GUARANTEES in 2005
133 guarantee agreements (9,0 million EUR)
The rural entrepreneurs used the guarantee mostly to receive loans (16,7 million EUR), and factoring-financing (0,7 million EUR). For leases the guarantees were used significantly less.
The average amount of a loan issued to a ruralentrepreneur was 130 000 EUR, which on averagewas guaranteed by the Foundation in the amount of70 000 EUR or by 51,7 %.
GUARANTEE ACTIVITY01.01 - 31.12.2005
Activity percentageagriculture 75,00food processing industry 14,62forestry 0,78other industry 2,29fishery 0,43wholesale 1,94service 0,69other 4,25
100,00
LOANS PORTFOLIO (in million EUR)
0
5
10
15
20
25
30
35
40
45
2001 2002 2003 2004 2005
All loans Loans with RDF's credit risk
LOANS in 2005
RDF issues two types of direct loans:• investment loan; • loan for bridge financing of non-profit
associations.
Other loans are issued to customers by co-operation partners: banks, leasing companies,savings and loan associations.
LOAN ACTIVITY 01.01 – 31.12.2005
Investment loan 1,5 21Loan for bridge financing of non-profit associations 1,6 24Loans via savings and loan associations 2,2 31Loans via banks and other financial institutions 1,5 21Working capital loan 0,2 3Total 7 100
Loan amount due to
obtained by enterprises from 1997 to 2005
is 323 million EUR /incl. loans 220 million EUR
and loans with RDF´s guarantee 103 million EUR/
COOPERATION PARTNERS
Hansapank, SEB Eesti Ühispank,
Sampo Pank, Tallinna Äripank,
Eesti Krediidipank, Parex Banka,
Bayerische Hypo- und Vereinsbank AG
as well as their subsidiaries.
The Foundation has co-operation contracts
with savings and loan associations.
CONTACT
Aadress R.Tobiase 4, 10147 Tallinn, Estonia
Telephone +372 648 4064
Facsimile +372 648 4065
E-post [email protected]
Internet http://www.mes.ee
Management Board
Raul Rosenberg, Rain Vändre, Thea Kaurla
Thank you for your attention!
Questions?
