EXPAND YOUR BUSINESS INTERNATIONALLY FINANCING SUPPORT TO ORGANIZATION OF WOMEN IN INTERNATIONAL TRADE

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 1 INTRODUCTION EXPORT DEVELOPMENT CANADA (EDC)  Federal Crown Corporation  Partners with banks to support exporters  Scotiabank works with EDC to provide solutions for exporters in Canada and abroad Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 2 Working Capital Solutions Risk Mitigation Tools Financing EDC Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 3 Why Use EDC? 1.Allows Exporters to increase funds available to expand export business without tying up working capital 2.Provides guarantees to banks to enhance commercial credits 3.Allows the banks to provide more innovative solutions for our customers 4.It is easy to use Working Capital Solutions EDC Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 4 EDC solutions and the transaction cycle FINAL PAYMENT Warranty Period 6 months - 2 years Warranty Bond (10%) Delivery and Installation Bid Bond PSG (5%) Bid Stage 6 months SHIPMENT CONTRACT SIGNING MANUFACTURING PERIOD PRE-CONTRACT Receivable - 90% coverage EGP PSG ARI FXG EDC SOLUTIONS AND THE TRANSACTION CYCLE Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 5 ProductSolution EGPWorking Capital or Term loans for pre-export financing PSGForeign Contract Obligations (foreign guarantees for bids, performance) FSGForeign Payment Obligations FXGForeign exchange ARIInsurance for foreign account receivables to support working capital loans Scotiabank named BEST TRADE FINANCE BANK in Canada for the third time in four years EDC PRODUCTS Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 6 EDC PRODUCTS Exporter Guarantee Program (EGP) What is it ? It is a guarantee that covers up to 75% of advance pre-shipment loans, operating facilities, term loans in support of specific contracts, general corporate purpose financing or the acquisition of a foreign asset or company by providing additional security. How does it work? (see flow chart) (see flow chart) EGP supports the following scenarios: 1.Contract Specific (pre-shipment) – EDC guarantees up to 75% of the facility. 2.Revolving Facility (pre-shipment) – supports multiple contracts. The facility is capped and EDC approves each PO under the line Guarantee usually terminates a month after the lender's annual review date. 3.Operating Facility –EDC guarantees up to 50% of the operating line to help with the general operations of the business.. 4.Term Loans - supports the preparation of investment related to specific export contracts ( normally up to 5 years.) EDC guarantees up to 50% of the term loan. Benefits EGP Overview What is it? Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 7 EDC PRODUCTS Exporter Guarantee Program (EGP) Provides 75% of credit guarantee to support pre-export credit EGP Sales Contract to be delivered in 6 months Provides pre-export credit facility CUSTOMER THE BANK FOREIGN BUYER Benefits EGP Overview What is it? EGP Overview Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 8 What is it ? It is a 100% irrevocable second-demand guarantee issued by EDC to support a bank guarantee. (SBLC/LG). It covers any type of contractual bonds like Performance, Advance Payment, Bids, Warranty, etc. How does it work? (see to flow chart) (see to flow chart) EDC issues the PSG guarantee in the bank’s favor, covering 100% of losses if the buyer, for any reason, makes a demand against the bank’s instrument (LG /SBLC). These guarantees can be foreign or local (if there is evidence of a product/service being exported). EDC PRODUCTS Performance Security Guarantee (PSG) Why use it ? It eliminates the collateral typically asked by a bank when issuing foreign guarantees because EDC provides its support improves permitting a bank to free up W/C facilities for the customer. Benefits PSG Overview What is it? Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 9 EDC PRODUCTS Performance Security Guarantee (PSG) Brief description of how this product works… Supply of Goods & Services 1 2 Requests Guarantee Issues PSG Product Instruction to Issue a Guarantee 3 SCOTIABANK CUSTOMER PURCHASER Issuance of Performance Security Guarantee (PSG) Benefits PSG Overview What is it? Foreign Bank Issue Guarantee 4 5 Issues Local Guarantee PSG Overview Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 10 What is it ? FSG is a 100% irrevocable second-demand guarantee issued by EDC to support a bank’s financial SBLC or guarantees It supports an exporters’ financial payment obligations in the following scenario: How does it work? (see flow chart) (see flow chart) EDC guarantees the SBLC covering 100% of losses if the buyer, for any reason, makes a demand against the bank’s instrument (LG/SBLC). EDC PRODUCTS Financial Security Guarantee (FSG) Collateral to a foreign (or local) supplier to obtain extended payment terms. If an exporter requests its foreign supplier for longer payment terms for its purchases usually the supplier requires some type of guarantee. In this scenario, a bank issues a SBLC and obtains a FSG from EDC for 100% of the transaction. What is It ? Why use it ? Scenario 1 Scenario 2 Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 11 EDC PRODUCTS Financial Security Guarantee (FSG) Request Guarantee Issue FSG Product Instruction to Issue a Guarantee Issue Guarantee 3 SCOTIABANK CUSTOMER VENDOR Issuance of Financial Security Guarantee (FSG) CANADA FOREIGN COUNTRY Extends payment terms (30 – 180 days) Collateral to foreign suppliers to obtain better payment terms What is It ? Why use it ? Scenario 1 Scenario 2 Foreign Bank Provides Financing 5 Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 12 What is it ? A 100% Guarantee of a foreign exchange contract facility for an exporter. Foreign Exchange Guarantee supports FX contracts related to foreign transaction domestic purchases (domestic supplier to a domestic seller if it is shown that the goods in question are to be 100% exported). How does it work? The customer requests a bank to establish a FX facility and EDC to issue the guarantee in favor of the bank. Why use it ? The FXG will replace the collateral, and by doing so, increase a bank’s capacity to provide additional support to the exporter. What is It ? Benefits FXG Overview EDC PRODUCTS Foreign Exchange Guarantee (FXG) Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 13 EDC PRODUCTS Foreign Exchange Guarantee (FXG) The Bank receives a 100% guarantee from EDC The Exporter signs the EDC Application and obtains a FX facility from Scotiabank The Bank returns the letter of offer duly signed EDC provides approval directly to the Bank EXPORTER 1 1 The Exporter submits all other required information 3 4 The Exporter (or the Bank) pays the FXG fee What is It ? Benefits FXG Overview Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 14 EDC PRODUCTS Accounts Receivables Insurance (ARI) What is it ? This program protects the Exporter against non- payment of their accounts receivable for up to 90% of losses resulting from a wide range of commercial and political risks. It is an excellent solution for Canadian exporters selling on open account terms. Exporter presents an application to EDC and this if approved provides a Letter of Offer with coverage criteria. Upon Exporter acceptance, the policy is activated and the policy documents are sent to the Exporter. At the request of the client EDC establishes an insurance policy in favour of a bank. The standard ARI policy protects the Exporter against: -Buyer insolvency; -Buyer payment default; -Buyer repudiation (where buyer refuses to accept the goods); -Contract cancellation (if contract coverage is in place); -Currency transfer risk (buyer's inability to transfer hard currency out of the country); -Cancellation of export or import permits; and -War, revolution or insurrection A bank establishes a W/C facility in favor of the Exporter based onits foreign account receivables. The amount of the facility is increased if the A/Rs are insured by EDC or other insurance. How does it work? ARI Overview Benefits What is It ? Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance

G L O B A L T R A N S A C T I O N B A N K I N G Product Specialists TRADE FINANCE SOLUTIONS HomeIntroduction Supply Chain Financing Solutions EDC Products The Scotiabank Network Advantage Commodity Financing Risk Maps for Trade Finance Products Find Out MoreTable of Contents 15 Insurance to A/R EDC PRODUCTS Accounts Receivables Insurance (ARI) W/C in favour of Exporter A/R from multiple Buyers ARI Overview Benefits What is It ? ARI Overview Performance Security Guarantee EDCWhy Use EDC EDC Solutions and the transaction Cycle EDC Products Exporter Guarantee Program Financial Security Guarantee Foreign Exchange Guarantee Accounts Receivables Insurance