Preliminary results of business activities in 2006

According to preliminary results, the Export Guarantee and Insurance Corporation (EGAP) concluded 366 new insurance contracts for the insurance with state support in the total worth of almost CZK 30 billion in the last year. It is an increase by 35 per cent in comparison to 2005; export contracts in the value of about CZK 80 billion were supported. The premium written exceeded CZK 900 million and the amount of approximately CZK 470 million was paid out as indemnification. EGAP will utilize the expected profits for strengthening of insurance funds so the company can operate further without any requirements on budgetary appropriations.

Results of EGAP's operations in the last year were significantly influenced by conclusion of several insurance contracts for export projects each with the insurance value over CZK 1 billion. Among them was for example the construction of a highway in Azerbaijan, electrification of a railway in Montenegro or construction of a multifunctional centre in Tunis.

Territorially, EGAP insured Czech exports predominantly to Russian Federation; it was CZK 7.5 billion in 2006, representing 1 of the insured volume. The rest of CIS countries made further CZK 4.7 billion. Countries with the highest risk level where the Czech exports went with EGAP´s insurance were beside Cuba, Uganda and others, also Iraq. The insurance contracts for the exports to this country were concluded in the volume of approximately CZK 0.6 billion. In 2006, EGAP insured the export contracts to altogether 61 countries. In comparison to 2005, there were 12 additional countries in this list and, for the first time in history, Armenia and Australia.

During the last year, EGAP amended in cooperation with the banking sector general insurance conditions in all insurance policies in the way so even after application of new rules for capital adequacy of banks "Basel II", the commercial banks are able to give to credits and bank guarantees insured with EGAP the zero risk weighting and thus to offer them to their clients under advantageous conditions. Result of cooperation with the banking sector are also new insurance products enabling on the one hand the investors to receive loans for the financing of the investment in foreign countries, and on the other hand the exporters to finance the export receivables in the form of supplier credits.

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