Financing Process managed by exim bank for the Iranian approved projects

1. BUILDING TOGETHER THE PROSPEROUS
FUTURE FROM THE BOTTOM UP:
Korea Eximbank in Financing Investment
Projects
Tehran, 4th October 2015
YoungKee KIM
Senior Director General

2. AGENDA
1. SNAPSHOT OF KOREA EXIMBANK
2. SECTORAL PROSPECTS FOR COOPERATION
3. FINANCIAL SOLUTIONS TO OFFER

3. INTRODUCTION TO KOREA EXIMBANK
SECTION 1

4. Overview
Korea’s official Export Credit Agency (ECA) providing both export credit
and investment finance related to Korean companies conducting
business in the global market.
Financial
Channel for
Economic
Cooperation
Korea Eximbank’s Mandate & Sovereign Status
Government
Policy Arm
Sovereign Credit
Status
 Since establishment in 1976, Korea Eximbank has
actively supported Korea’s export-led economy and
facilitated economic cooperation with foreign countries.
 Two financial windows: (i) export and investment credit
(at market-terms), (ii) EDCF/ODA (at concessional terms)
 Mandated to promote Korea’s external transaction
sector, Korea Eximbank plays an integral role in
implementing public policies for the national economy.
 Wholly owned by the Korean government which is
required to maintain its solvency and supplement
possible deficits.
 Boasts the sovereign credit rating of Korea (Moody’s:
Aa3, S&P: AA-, Fitch: AA-)

5. Financial SolutionsGlobal Network
Korea Eximbank’s Competence for Quality Services
 Most credit amount of all time
(USD 77 Billion in 2014)
Why Korea Eximbank?
Korea Eximbank boasts established experience in financing projects overseas,
along with its wide global network, up-to-date financial products, and in-house
expertise and capacity.
Europe, Asia
98 MOUs
(32 countries)
North America
6 MOUs
(2 countries)
Central/South
America
18 MOUs
(9 countries)
Middle East,
Africa, Oceania
46 MOUs
(12 countries)
Total : 168 MOUs (55 countries)
 Experience in 63 PF deals
(Total amount of USD 24 bil)
FA
MLA
Credit
Support
Equity
Participation
 Financial Advisor/Arrangement
(42 deals, USD 71bil)
 Equity Participation
(Invested in 2 projects, 6 funds)
“168 MOUs with
ECA & CIBs”
“Total Financial
Solution Provider”
Korea Eximbank in PF Market
ECA USD Million No. of DealsRanking
JBIC
US EXIM
Korea
Eximbank
China
Eximbank
EDC
35,938
18,519
11,574
8,934
8,034
56
27
37
18
67
1
2
3
4
5
ECA League Table (2008~2013, OECD)

6. Visibility of Korean ECA
 Korean ECAs play a major role in the international export credit
market.
(source : TFX, 2015)

7. ECAs’ Financial Support to Middle East
 ECAs are most important
player to finance the
major infrastructure
projects:
– Correcting market failures;
– Mitigating against risks;
– Assuming risks as the
lender of last resort;
– Providing main source of
financing for large-scale
investment
Region
Amount
(billion)
Percentage
( %)
Asia 28.24 22.6
Europe 25.62 20.5
North America 24.15 19.3
Middle East 16.28 13.0
Latin America 13.73 11.0
Africa 9.89 7.9
Russia CIS 7.06 5.7
Total* 124.52 100

8. (USD Million)
3,694
5,442
7,249
11,458
14,430
15,388
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
`09 `10 `11 `12 `13 `14
Annual Cumulative Approval
Korea Eximbank’s Presence in MENA
 The Bank continues to increase its focus on MENA as the
region is the one of major global markets for Korean firms.

9. Profile of Korea Eximbank’s Support in MENA
 The magnitude of KEXIM Financing in the region is significant.
 Petrochemical & power plants have been major sectors

10. KEXIM’s Presence in the Selected Neighboring Countries
KSA UAE OMAN QATAR IRAN
GDP ($ bn)
$649
(28th)
$364
(31st)
$63
(70th)
$197
(48th)
$393
(20th)
Pop.(million) 27 10 4 2 81
OECD
Classification
3(’06)→2(’15) 3(’13) →2(’15) 3(’06) →2(’15) 2(’12) →3(’15) 5’(06)→6(’12)→7(’15)
Amount of
Financing
($ bn)*
11.4 6.3 2.0 1.9 -
 Oil-producing GCC countries have been key destinations for
KEXIM financing
* Approval basis, cumulative for both export and investment

11. SECTORAL PROSPECTS FOR
COOPERATION: MATCHING INVESTMENT
NEEDS WITH FINANCING
SECTION 2

12. Oil & Gas
 Investment Needs – overview
– Oil & Gas took 70% of the national export in 2012
• The world’s 4th-largest crude oil and the 2nd-largest natural gas reserves. (EIA,
2015)
– Consisted of upstream (exploration & production), midstream (LNG,
pipelines), and downstream (refinery, petrochemicals, Gas-to-Liquids)
• Currently a net importer of refined goods and petrochemicals although
aspiring to export them
– The sanction significantly reduced both production and revenue
• Crude Oil: 3.7 mil. barrels per day (2011) → 2.7 mil. b/d (2013)
• Natural Gas: around 8.1 TCF during 2011~2013.
• Oil & Gas export revenue dropped to $56 bn. in 2013/14 from $118 bn. in
2011/12 fiscal year
– More than $100 bn. investment is estimated to be needed in the
following 3 years for all subsectors

13. Oil & Gas (cont’d)
 Upstream (Exploration & Production)
– NIOC targeting 45 projects for potential development, utilizing foreign investment,
with high priority
– Upstream development to be focused in particular on: Yadavaran (NIOC and
Sinopec), Azadegan (including South Azadegan, shared with Iraq), and South Pars
(shared with Qatar’s North Field)
 Midstream (LNG, Pipelines)
– South Pars gas production (traditionally for LNG export, now supplying the
domestic market)
– Revitalizing numerous investment schemes prior to the strengthening of EU
sanctions:
• Persian LNG (NIOC, Repsol, Shell), Pars LNG (NIOC, PETRONAS, Total), Iran LNG (NIOC,
OMV)
– Cross-border pipeline projects (e.g. Kuwait, Pakistan-India)
 Downstream (Petrochemicals, Refining & Gas-to-Liquids)
– Aspiring to export petrochemicals and refined products rather than crude oil or
natural gas
– Also considering gas-to-liquids (GTL) projects
– Refining and petrochemicals projects may be attractive in the current low
oil price environment

14. Oil & Gas
 Why Korea?
– Having extensive experience and capacity in various areas of the sector inside and
outside Korea
– Globally, successfully carried out contracts in the three subsectors of the industry
• Overseas contract worth $75.4 billion from 2010 to 2014. 3Q
– In Iran, completed large scale projects such as the NIOC Gas Facility Development
Project and the PCC Petrochemical Facilities Project
 Footprints of Korea Exim Financing & Applicable Financial Tools
– Exemplary landmark projects financed by KEXIM includes:
• South Pars, Phase 9 & 10 ($625 mil., 2003)
• Qatar Barzan Gas Project (Hyundai Heavy Industries) providing $1 billion (2011),
• Saudi Sadara Project (Daelim Industrial Co.) providing $400 million (2013)
• Oman OPRC Oil Refinery Expansion ($600 ml., 2014)
– Financing through Framework Agreement (FA), prioritizing on projects to be
initiated by state-owned enterprises (& their subsidiaries) such as NIOC, NPC, NITC,
and IRISL;
– Also, Project Finance (non/limited-recourse basis) scheme is applicable if a more
investor-friendly contractual platform (in place of the buy-back agreement) is
proposed:

15. Infrastructure
 Investment Needs
– Construction industry is expected to grow 4.3% p.a. on avg. over the
next 5 years (Fitch, BMI Research)
– Strong demand for modernizing infrastructures in line with the
revival of the economy (airport, roads, railroads, and water facilities)
 Why Korea?
– An extensive experience in global infrastructure projects (since 1965,
$654 billion 10,142 infrastructure projects)
ENR Ranking Korean Firms
17 Hyundai Engineering & Construction Co. Ltd
21 Samsung C&T Corp.
36 Daewoo Engineering & Construction Co. Ltd
38 GS Engineering & Construction
39 POSCO Engeneering & Construction
46 SK Engineering & Construction
52 Daelim Industrial Co. Ltd
- 7 more Korean firms are within top 250
(ENR, 2015)

16. Infrastructure
 Footprints of Korea Exim Financing & Applicable Financial
Tools
– Provided €110mil for the Iranian IRICO Rail Vehicle Project in 2005
– $280mil for the Turkey Eurasia Underwater Tunnel Project in 2012
– Applicable financial tools
• Re-establishing Framework Agreement (under discussion with Iranian
authorities)
• A package of various financial products readily available for infrastructure
investment
 Direct loan, financial guarantee, and equity investment

17. Components, Consumer Goods, & ICT
 Investment Needs
– Iran as the largest car producer (2011) in the Middle East, expected increasing
demand for steel products and car components
– Manufacturing industry accounts for approximately 40% of the Iranian GDP
– A large consumer market with huge population (more than 60% being under 30’s)
– ICT: largest non-oil economic sector in Iran with sustainable source of revenue
generation
 Why Korea?
– Car components globally competitive in price & quality
• In business with world-renowned auto manufacturers in the US, Germany, Japan, etc.
– Most advanced mobile communication technology (the world’s first LTE-A)
• Contracted supplying large scale LTE network device both in emerging and developed
countries, e.g. India (Reliance) and the US (Sprint)
 Footprints of Korea Exim Financing & Applicable Financial Tools
– Provided the aggregate of U$546 mil for Interbank Credit Facility until 2008, and
U$1,841 mil for Forfaiting Facility until 2012
– Prepared to reactivate the Interbank Credit Facility & Forfaiting Facility to support
trading for steel, car components, home appliances, ICT, etc.

18. Healthcare Service
 Investment Needs
– Government’s strong drive to upgrade healthcare facilities & services
– 10 or more hospitals (public only prior to the lifting of sanctions), R&D centers,
pharmaceutical complex projects in the pipeline
 Why Korea?
- Track record of building major hospitals of 2,000 beds or more
- High quality of medical services with qualified doctors
- Efficient hospital management system using advanced Korean ICT
 Footprints of Korea Exim Financing & Applicable Financial Tools
– Aggregate of U$900mil provided for healthcare industry worldwide
– FA and total financial solution (including loans, guarantees, and equity investment)
are applicable for healthcare projects to enhance healthcare service of Iran

19. FINANCIAL SOLUTIONS FOR KOREA-
IRAN ECONOMIC PARTNERSHIP
SECTION 3

20. KEXIM: Total Financial Solution Provider
Korea Eximbank’s support for diverse industrial projects ranges from loans and
guarantees to financial advisory/arrangement services and equity investment.
Project
Company
Off-taker
Loan
Sponsors
(Korean)
[Sponsors]
Sponsors
Equity
Investment
Korea Eximbank
Guarantee
Loan
Financial Advisory Service
Financial
Arrangement
Other ECAs, MDBs
[Lenders]
EPC Contractor
Loan
O&M Contractor
Guarantee
Equity Investment
Commercial Banks
Fund
Fund Investment

21. Framework Agreement
 Credit limits & main terms are agreed upon in the Framework Agreement
signed by Iranian banks or the central bank
 For individual export transaction, the Letter Agreement is concluded
Letter Agreement signing
Lender
Central Bank of Iran Designation of borrower for
FA
Exporter
(Korean Company)
FA negotiation
Korea
Eximbank
Ministry of Economic
Affairs and Finance, Iran
Global Guarantee
FA signing
Export contract
Importer
(Iranian Company)
Shipping documents &
Financing L/C opening
Borrowers
Iranian
Banks

22. Interbank Credit Facility
 With its peak in 2005 (U$131mil), aggregate of U$546mil was provided until 2008
 U$10mil credit line is still maintained
 Primary sectors for financing: car components, steel, petrochemicals, etc
Credit Line
Korea
Eximbank
Iranian
Bank
Iranian
Importer
Loan Sub-Loan
Car
components
36%
Steel
18%
Petroche
micals
23%
Textile
8%
Others
15%
Interbank Credit Accumulated
Commitment by sectorHow It Works

23. Forfaiting
 A financial transaction involving the purchase of receivables from exporters by forfaiter
 With its peak in 2011 (U$693mil), aggregate of U$1,841mil was provided until 2012
 Primary sectors for financing: steel, chemicals, plastics, car components, etc.
Steel
53%
Chemicals
11%
Plastics
11%
Car
Components
7%
Papers
6%
Others
12%
Forfaiting Accumulate
Commitment by sector
Exporter
(Korean
Company)
Korea
Eximbank
Importer’s
Bank
(Iranian
Bank)
① Shipping
documents
② Export
Payment
③ Shipping
documents
④ Export
Payment at
maturity
How It Works

24. Project Development Program
 Project Identification → Project Advisory → Financial Advisory Arrangement
Korea Eximbank provides various services for the entire period of projects.
Project Procedures
Transaction Advisory
FA / MLA
 Provide transaction
advisory, establish
financing plan mainly for
investment and development
projects (L/I from major
financial institutions)
 Close communication with
ordering organization
 Assist companies in bidding
processes
 Suitable for companies that
have no experience in the
country
 Financial advisory services
to the sponsors from the
bidding stage to financial
closing
 KEXIM and major
commercial banks as co-
advisor in case that ECA
financing is a key factor for
the project
 Take lead in general for
negotiation of project
documents, cooperation with
consultants, etc.
 Including arrangement of
direct/indirect investment
from KEXIM
 Financial Arrangement
services for loan syndication
Project Identification
 Identify project, connect
Korean companies to
projects
Financing Stage
- D.D, Syndication
Tender Preparation
& Implementation
Financial Closing
Project Structuring
Project identification
Consortium Formation
Feasibility Study
Financial Planning

25. CASES
SECTION 3

26. - First Iranian oil & gas project Korea Eximbank co-financed with European ECAs.
- NIOC undertaking through
 Assignment of NIOC Off-take agreement, and
 Offshore escrow account
- Government support letter
Upstream Oil & Gas – South Pars Phase 9, 10
NIOC
EPC Contractor
Government
Korea Exim
HermesEPC Contract
Finance Documents
Off-take Contracts
Lenders
Debt Financing
Comfort Letter
SACE
EGCD(UKEF)
NCM
Commercial
Banks
Off-takers
Escrow Account
Off-take Payments Loan Repayments

27. - The first Egyptian project Korea Eximbank financed together with Japanese ECAs.
- Egyptian government’s strong support for the project.
Downstream Oil & Gas – Egyptian Refinery Project - ERC
Equity Investment
Company H
(3%)
Company E
(15%)
SPC
(Egyptian Refining
Company)
EPC Contractor
Government
(Prime Minister
Ministry of Finance
Ministry of Petroleum)
Off-taker
(EGPC)
Korea
Eximbank
JBIC/NEXI
EPC Contract
Finance Documents
Offtake
(25yrs)
EIB
AfDB
Sponsors
Lenders
O&M Contractor
O&M Contract
Comfort
LetterFeedstock
(25yrs)
Debt Financing
Company A
(82%)
Comfort
Letter

28. Transportation – Turkish Tunnel Project – Eurasia Tunnel
Equity Investment
Korean Co.
(50.1%)
Company B
(49.1%)
SPC
(Eurasia Tunnel)
EPC Contractor
(Sponsors
Consortium)
Ministry of
TreasuryMinistry of
Transportation
Korea
Eximbank
K-Sure
EPC Contract
Finance Documents
Implementation
Contract
EIB
EBRD
Sponsors
Lenders
O&M Contractor
O&M Contract
Direct Agreement
(Step-in Right)
Debt Assumption
Agreement
Minimum Revenue
Guarantee
- Korea Eximbank financed the tunnel project together with K-Sure, EIB & EBRD.
- Turkish government provided minimum revenue guarantee for the project.
Debt Financing

29. Korean
Company A
Indonesian
Company C
Korean
Company B
SPC
(Semangka
Hydro Power)
EPC Contractor
(Korean Co. B)
Off-taker
(PLN)
Korea
Eximbank
Commercial
Banks
EPC Contract
Sponsors
Lenders
O&M Contractor
(Korean Co. A)
O&M Contract
Indonesian
Company D
Debt Financing
Equity Investment
- Korea Eximbank participates in the transaction as an equity investor as well as
PF senior lender.
- Korea Eximbank provides 90% of the total debt financing.
Ministry of
Finance
Power – Indonesian Hydro Power Project - Semangka
Off-take Agreement
Guarantee
Equity Investment

30. Korean
Company A
SPC
(QEPC)
EPC Contractor
(Korean Co. B)
Off-taker
(NEPCO)
Korea
Eximbank
Multilateral
Development
Banks
EPC Contract
Sponsors
Lenders
O&M Contractor
(Korean Co. A)
O&M Contract
Saudi
Company B
Debt Financing
Equity Investment
- KEXIM led the deal to be closed in the midst of the global of financial crisis
- Has supported project sponsor from the bid stage to operation stage, a life-time
partner.
Ministry of
Finance
Power – Jordan CCGT Power Project – Al Qatrana
Off-take Agreement
Guarantee

31. Abu Dhabi
Company
SPC
(JL 5&6)
EPC Contractor
(Korean and Japanese)
Off-taker
(ONE)
Korea
Eximbank
JBIC, NEXI
EPC Contract
Sponsors
Lenders
O&M Contractor
(Sponsor related)
O&M Contract
Debt Financing
Equity Investment
- Korea Eximbank supported Korean construction company through conventional
export credit scheme.
- The project benefits from optimal financing package of Korea Eximbank, JBIC,
NEXI, and local currency financing providers.
Ministry of
Finance
Power – Morocco Thermal (coal fired) Power Project – Jorf Lasfar
Off-take Agreement
Guarantee
Commercial
Banks

32. Equity Contribution
Company C
(60%)
Korean
Company
(20%)
Company D
(20%)
SPC
(ITS, Payment
system)
Korean EPC/O&M
Contractor
City of Bogotá
(100%)
Trust
Korea
Eximbank
IFC
Korean
Commercial
BanksSupply Contract (EPC, O&M)
Concession
Contract
Sponsors
Lenders
- Korea Eximbank provided loan and guarantee covering 80% of total debt and
arranged IFC & commercial banks to fill the shortfall.
- The City of Bogota provided the availability payment to the SPC.
Ordering
Entity
Finance Documents
Senior Loan
Mezzanine Loan
Financial
Arrangement
ICT – Colombian ITS Project
Availability Payment
(weekly payment)
Stabilization
Fund
Gap
Funding
Passengers
Toll

33. Director General
Mr Hwan-joon Yang
+822-3779-6391
hjyang@koreaexim.go.kr
Oil & Gas Plant
(Middle East, Russia)
Mr Jae-sun Shim, Director
+822-3779-6404
shimm@koreaexim.go.kr
Oil & Gas Plant
(Asia&CIS, Africa, Europe, Americas)
Mr Won-Kyun Lee, Director
+822-3779-6403
circle@koreaexim.go.kr
Oil & Gas Plant, Infrastructure
(Middle East & CIS)
Mr Jae-Cheol Kim, Director
+822-3779-6413
jaeckim@koreaexim.go.kr
Director General
Mr Yong-Mong Kim
+822-3779-6461
yongmong@koreaexim.go.kr
Power I(Southeast Asia, Central Asia)
Mr Oh-soon Song, Director
+822-6255-5381
songoh@koreaexim.go.kr
Power II(Americas, Western South Asia)
Mr Woo-Young Jang, Director
+822-6255-5398
wyjang@koreaexim.go.kr
Nuclear Power (Middle East & Africa)
Mr Jae-Rak Lee, Director
+822-6255-5381
jrlee@koreaexim.go.kr
Plant Finance
Department I
Plant Finance
Department II
Business Development
Department
Natural Resources Finance
Department
Interbank Finance
Department
Service Industry Finance
Department
Director General
Mr Tae-hyung Lee
+822-3779-6423
leeth24@koreaexim.go.kr
Natural Resource I
Mr Do-Hyung Lee, Director
+822-3779-6437
leedh2030@koreaexim.go.kr
Natural Resource II
Mr Hwan-Woo Kim, Director
+822-3779-6447
G1052_kim@koreaexim.go.kr
Director General
Mr Byung-Chul Won
+822-3779-6361
bcwon@koreaexim.go.kr
Mr Haeng-Ryul Jun, Director
+822-3779-6363
hanks@koreaexim.go.kr
Senior Director General
Mr YoungKee Kim
+822-6255-5241
youngkee.kim@gmail.com
Team I (America, CIS, Oceania)
Mr Jong-Hyuck Ahn, Director
+822-6255-5232
jhahn@koreaexim.go.kr
Team Ⅱ (Asia, Middle East, Africa)
Mr KJ Yang, Director
+822-6255-5243
Kj.go.yang@gmail.com
International Relations (Europe)
Ms Hee-jung Seo, Director
+822-3779-6389
moli@koreaexim.go.kr
Contact
Director General
Mr Ki-Yeon Hwang
+822-6255-5261
yoojin@gmail.com
Service Industry I (ICT, Tourism)
Mr In-Kyu Cho, Director
+822-6255-5268
icho@koreaexim.go.kr
Service Industry II (Healthcare, Logistic)
Mr Yong-Min Cho, Director
+822-6255-5262
ymcho@koreaexim.go.kr

34. Thank You !
For more information,
Visit us at www.koreaexim.go.kr