VIII.     TRADE AND PROJECT FINANCING


The Finnish Banking System

The Finnish banking system is dominated by six banking groups:
Kansallis-Osake-Pankki (KOP Bank), the Union Bank of Finland
(Unitas Group), Okobank (the Cooperative Bank Group),
Postipankki, the Savings Bank of Finland (SBF), and Skopbank.
One U.S. bank, Citibank, is represented in Finland; in June 1994
its office in Helsinki was upgraded to branch status.

The banking sector has undergone considerable consolidation in
recent years following severe losses, particularly for the SBF
and Skopbank.  The losses stemmed in part from a large expansion
of credit and some questionable lending practices in the late
1980's as well as the severe economic recession from which
Finland is just emerging.  In 1993, the government established an
asset management company, Arsenal, to isolate the nonperforming
corporate loans and real estate assets of the SBF.  Total
government assistance to the banking sector has been
approximately FIM 43 billion ($7.8 billion) exclusive of
government guarantees.  Banking losses are shrinking, however,
and a return to profitability in 1995 is possible.  All banks are
undertaking programs to increase productivity and close unneeded
branches.


Banks with Correspondent U.S. Banking Arrangements

All principal Finnish banks have an extensive correspondent
relationships with U.S. banks, maintaining relationships with
banks in every state as well as with all of the larger financial
center banks.  Further information on correspondent relationships
can be obtained from the Finnish Bankers' Association, P.O. Box
1009, 00101 Helsinki; tel: 358-0-440-211, fax: 358-0-498-030.


Foreign Exchange Controls

All Finnish foreign exchange controls have been abolished.


General Financing Availability

Financing availability in Finland is similar to that in the
United States.  All of the major Finnish banks have export
financing units.  Finnish government programs are detailed below.

Terms generally applied to international trade among industrial
countries apply to selling in Finland.  In the beginning of a
business relationship, a letter of credit should be requested.
When a satisfactory trade relationship has been established,
including a satisfactory credit rating, 30-60 days net is normal.
The terms are negotiable and may vary according to the size and
scope of the transaction.


Government Financing Programs

Exim financing is available for Finland.  Following are Finnish
government programs providing export and other forms of
financing:

Finnish Export Credit Agency:  Finland's leading export financing
institution, it provides financing to Finnish exporters of
capital goods, mostly on market terms.  It is 100 percent owned
by the Finnish government.

Finnfund - The Finnish Fund for Industrial Cooperation:  Similar
to OPIC, Finnfund promotes investments in developing countries.
It has recently become very active in the former Soviet Union,
particularly Russia and the Baltic countries.  The investment
must have a Finnish component, but third country partners can
participate as well.  Finnfund provides equity capital as well as
loans and also participates in guarantee arrangements.

Finnish Guarantee Board:  Its main function is to provide small
and medium-sized enterprises (SME's) with export credit
guarantees.  The guarantees cover commercial and political risk.

Kera:  Kera provides financing to promote the development of
SME's in "development areas" of Finland.  Three-fourths of the
financing is for manufacturing, the remainder for tourism and
other services.

Ministry of Trade and Industry:  The ministry provides funds for
the "internationalization" of firms, primary SME's.  The funding
can be used for a wide range of services to increase a firm's
ability to export.  The grant cannot normally exceed 50 percent
of the costs involved.


Project Financing

Multilateral lending institutions do not make loans for projects
in Finland.  The Finnish Export Credit Agency and Finnfund
provide financing for overseas projects.  Participation of third
country firms in projects is possible.