NLB operates internationally through a network of representative offices located in major financial centres including New York, London, Frankfurt, Milan and in the capital cities of countries which are important trading partners of Slovenia - Moscow, Prague and Budapest. In 2001 representative offices were opened in Warsaw and Belgrade and closed in Paris and Skopje. NLB maintains its direct presence abroad through its branch in Triest, subsidiaries in New York, Prague, Sarajevo and Zurich, affiliates in Frankfurt and Vienna and through capital investment in Skopje.

Over the years, NLB has built strong business relationships with multilateral financial institutions, including the World Bank Group, European Bank for Reconstruction and Development, European Investment Bank, InterAmerican Development Bank, Institute of International Finance and other leading supranational organisations. NLB is also a member of several national and international associations as well as a founding member of the Mediterranean Bank Network consisting of 11 leading banks from Mediterranean countries. Principal activities of the network are linked to exchange of trade, investments and information.

International payments

In 2001 NLB maintained a correspondent relationship network of more than 1,300 banks in 134 countries, which enabled it to execute efficiently international payments and other forms of trade finance. With these banks we held 97 accounts in foreign currency ('nostro accounts'), whereas the number of foreign banks' accounts in Slovenian tolars or in foreign currency maintained with NLB totalled 319 ('loro accounts'). Compared to previous years the number of these accounts dropped considerably, principally due to the trend in bank mergers and the introduction of the euro.

From the point of view of creating non-interest bearing revenues as well as strengthening the Bank's competitiveness, the area of international payments has remained one of NLB's key activities. Compared to the previous year, the total volume of international payments grew by 15 per cent to 8.6 billion euros. Inward remittances were up by 14 per cent, while outgoing payments totalled 3.9 billion euros, a growth of 15 per cent over 2000. The share of EMU currencies or euros in the total volume of international payments accounted 72 per cent, followed by US dollar with 19 per cent and others.

Export financing

Trade finance related services include various forms of buyer's credits, forfaiting and arranging of bank-to-bank loans and loans to financial organisations as well as providing insurance for trade related business through confirming letters of credit and letters of guarantee. The major share of export financing and insurance facilities provided was to support Slovenian exports to developing countries and emerging markets.

Special attention has been paid to Slovenia's major trading partners, CEFTA countries, Croatia, Bosnia and Herzegovina, Macedonia, FR Yugoslavia and the Russian Federation as well as countries in the Middle East and Turkey which are important target markets for Slovenian exports. Export-credit financing and insurance facilities were provided in co-operation with the Slovene Export Credit Insurance Agency ('SID'). One of the bigger transactions in 2001 was financing of the Russian buyer of Slovenian equipment through the Russian bank with insurance provided by the SID in the amount of 14 million euros. An important part of the financing activities offered was also the extension of loans to Croatian companies for the renewal of tourist facilities. In 2001 NLB's aggregate volume of export finance transactions including forfaiting reached 82 million euros.

Trade finance

By the end of 2001 outstanding foreign exchange guarantees reached 435 million Euros, of which net newly issued guarantees rose by 71 per cent to 245 million Euros. A significant increase in foreign exchange guarantee business is related to the financing of projects in a number of areas including telecommunications, highway construction and electricity generation.

In the year 1,461 letters of credit were issued with a total value 16 per cent above the previous year. This growth is due to the expansion of trade-related services such as buyers credits, bank to bank credits, forfaiting, confirmation, assignment of proceeds and transfers, each of which is dependent on letters of credit as part of its integrated offer.

Volumes of clearing and settlement of foreign cheques increased by 5 per cent in the last months of 2001, however as NLB has reached saturation level in the domestic market it will focus expansion of its Cash Letter Service outside Slovenia, particularly in Bosnia and Herzegovina, Macedonia and FR Yugoslavia. As the agent for American Express Travellers Cheques, NLB conducted a promotion to enhance sales and as a consequence won a special award by AMEX for achieving the best sales results in Slovenia.