FAS Online logo Return to the FAS Home page
Export Credit Guarantee Programs

Foreign Financial Institution Eligibility Requirements
and Evaluation Criteria
for the GSM-102 Export Credit Guarantee Program

(As of December 6, 2011)

Under Commodity Credit Corporation's (CCC's) Export Credit Guarantee Program (GSM-102), CCC will consider only foreign financial institutions which are capable of effecting payment in one of the two following ways:

  • An irrevocable foreign bank letter of credit, issued in favor of the exporter, specifically stating the deferred payment terms under which the foreign bank is obligated to make payments in U.S. dollars as such payments become due; or
  • An irrevocable foreign bank letter of credit, issued in favor of the exporter, that is supported by a related obligation specifically stating the deferred payment terms under which the foreign bank is obliged to make payment to the exporter, or the exporter's assignee, in U.S. dollars as such payments become due.

These eligibility requirements are contained in the Rules and Regulations, 7 CFR Part 1493, published in the Federal Register (59 FR 52866), on November 18, 1994.

CCC Evaluation Criteria

The following information, generally provided by the foreign bank, will enable CCC to evaluate the eligibility of financial institutions to assume payment obligations in connection with the GSM Export Credit Guarantee Programs:

  • Legal name and address of financial institution
  • Three most recent annual reports or related documents which include the following:
    • Auditor's report
    • Audited balance sheet
    • Off-balance sheet contingencies
    • Audited income statement
    • Audited cash flow statement or statement of sources and uses of funds
    • Related notes to financial statement
  • Statement of internal accounting practices
  • Description of internal controls employed to reduce risk associated with the bank's lending and other operations
  • Breakdown of bank ownership provided in the following format:
    • Individual shareholder ownership by percentage
    • Percent of government ownership
    • Identify entity or person with ultimate control or decision making authority, if different from majority shareholder
  • Organizational structure; i.e. independent or a subsidiary, affiliate, or branch of another bank.
  • Names and profiles of chief executive officer, chairman of the board, executive vice presidents, vice presidents, etc.
  • Percentage breakdown of loan portfolio by industrial sector
  • Total loans receivable 90 days or more past due
  • Breakdown of other assets (if amount exceeds ten percent of total assets) and contingent liabilities
  • Breakdown of amounts of loss reserves to cover losses on loans, other assets, and contingent liabilities
  • Breakdown of amounts and types of collateral to cover losses on loans, other assets, and contingent liabilities
  • Description of asset-liability and foreign exchange management strategies
  • Name of regulatory entity which governs the bank
  • List of correspondent banks in the U.S., including contact names, telephone, and fax numbers
  • Any other relevant quantitative or qualitative data which could assist CCC in fully evaluating the bank
Off Balance Sheet Activities

Disclosure of the kinds and outstanding amounts of derivatives (including futures, options, swaps), and other off balance sheet interest rate sensitive instruments (including repurchase and reverse repurchase transactions).

  • How are these instruments utilized? Describe any methods used for setting limits on these transactions.
  • Description of how the performance of the above instruments is managed. How is the market value of contracts monitored? Describe the types of pricing models employed.
  • How long has the bank utilized derivatives? Describe any losses incurred
  • Description of how credit risk, legal, and documentation risk is managed. Disclosure of who is authorized to develop derivatives contracts.

Participation Limits

Upon approval of eligibility as a foreign bank under the GSM-102 Program, CCC will establish a participation limit. To find out a particular foreign bank's participation limit, contact the appropriate bank analyst by the method described under "CCC Contact" in the section below.

CCC Contact

If you would like to inquire as to a foreign bank's eligibility under the GSM-102 program, please contact the bank analyst associated with the country or regions of interest. To do so:

  • Go to the Foreign Bank Obligors page;
  • Select the country or region to find the appropriate bank analyst. The bank analyst's name, telephone number, and e-mail address are listed at the end of each country or regional listing of banks.
  • If you have general questions about the eligibility of foreign banks for the GSM-102 program, please e-mail Rita Carleton phone number (202) 720-9357; Nestor Gregory phone number: (202) 720-9843; Michael Smith phone number: (202) 720-1282; Hal Taylor phone number: (202) 690-1267; Eli Fleminger phone number:  (202) 401-2575; Miguel Parkins phone number: (202) 720-3092;  Scott Kim phone number (202) 401-0218; Tim Hunt phone number (202) 720-1376; Michelle Zissimos phone number: (202) 690-1249; or Teri Ryan phone number (202) 720-0663.
  • Please send faxes to (202) 401-0114

Application Procedures

Foreign banks interested in participation are asked to provide the information referenced above.  We strongly suggest using this SAMPLE application to ensure submission of all necessary information.  Pleased complete the sample form and mail it, along with all relevant material, to the following address.  Packages sent via courier generally arrive faster.

 

Address for documents sent via courier:

Address for documents sent via postal mail:

USDA/FAS/OTP/CPD/Risk and Asset Management
ATTN: Teri Ryan
1400 Independence Ave., SW
Room 5509
Washington, DC 20250
USDA/FAS/OTP/CPD/Risk and Asset Management
ATTN: Teri Ryan
1400 Independence Ave., SW
Stop 1025
Washington, DC 20250-1025
 


Program Contact: Director, Credit Programs Division; Office of Trade Programs, Foreign Agricultural Service, USDA; Stop 1025; 1400 Independence Avenue, SW; Washington, DC 20250-1025; TEL (202) 720-3224; FAX (202) 720-2495; E-MAIL gsm.registrations@fas.usda.gov