Improving the Role of Eximbanks/ECAs in the OIC Member States
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Institutional Strength
Summary Assessment:
MEXIM has a full performance management system with Key Performance Indicators (KPIs) to
measure the performance of the organization and the individuals. MEXIM measures business
volumes and customer response times as part of its system.
MEXIM has a risk management framework which includes maximum exposure limits determined
by a capital adequacy formula which assess the Bank’s capacity to meet the time liabilities and
other risks such as market or credit risk, operational risk etc. The Bank has a limit of USD200
million per transaction. The Bank also seeks some reinsurance facilities. The non-performing
loan portfolio has shrunk considerably in recent years, with the focus on improved financial
performance. MEXIM’s financial results were impressive, leading to a dividend payment back to
the government shareholder.
For an organization with less than 300 people, staff retention is very high (less than 3% leave
annually) and most employees who leave end up in the banking sector.
Key Dimension Ratings: (1 – lowest, 10 – highest)
The institution’s expertise is well-recognized and sought after 9
The portfolio is actively managed 9
The internal processes are not bureaucratic 9
The institution’s human resources are stable and decisions are consistent 9
Private Sector Involvement
Summary Assessment:
MEXIM’s involvement with private sector sources of finance and insurance varies. It relies to a
certain extent on commercial banks to borrow for their funding needs. In addition, banks play a
role in co-financings and syndications for larger transactions. However, some competition
friction may exist where MEXIM is lending to corporates that commercial banks would be willing
to fund. In such cases, MEXIM makes a trade-off between only doing the higher risk “public
policy” deals and generating a lower financial return, rather than participating in good
transactions, for which some competition may exist.
In the credit risk area, more could be done to promote this sector. There are Credit insurance is
not really visible in Malaysia. There are other international credit insurers that are somewhat
active, but there is not enough attention being placed to build capacity in the country.
Key Dimension Ratings: (1 – lowest, 10 – highest)
The export credit system works well with banks 7
ECA works well with private insurers 5
ECA actively encourages participation of private players 5
There is no displacing/impeding of the private sector 6