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GLOSSARYTERMS AS A CREDIT DESK USES THEM

Export credit agency cover (ECA cover)

What is export credit agency cover, and how does it change a bank's risk?

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BY MICHAEL SHANG · SIXTEEN YEARS IN COMMERCIAL BANKING · UPDATED

// THE SHORT ANSWER

Export credit agency cover is insurance or a guarantee from a government's export credit agency, such as UK Export Finance, Export Finance Australia or New Zealand Export Credit, a unit of the Treasury, that protects an exporter or its lender against an overseas buyer's non-payment, or against part of the loss on a loan. A bank lending under cover is relying partly on the state, and the covered share can often be treated as exposure to the government rather than to the borrower. The cover comes with conditions, and a claim can fail if they were not met, so lenders read the policy as closely as the credit.

BASIS  Practitioner judgment from sixteen years in commercial banking, set out in How Bankers Think (Highbank Press, 2026). Every borrower on this site is a composite constructed for teaching, not a client. The market is mid-market commercial lending as practised in New Zealand and Australia; where a convention differs elsewhere, the page says so.

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