U.K. BANKERS CONSIDER NEW ECGD FINANCING PLAN
  Representatives of major U.K. Based banks
  are meeting here today to consider a new plan for reducing the
  cost of financing British exports guaranteed by the Export
  Credits Guarantee Department (ECGD), senior banking sources
  said.
      The plan is being developed in conjunction with the ECGD
  and the Bank of England.
      Neither the ECGD nor the Bank of England would comment on
  the plan. However, bankers said one of the main points under
  discussion is a plan to refinance the bulk of the ECGD's medium
  term credit portfolio in the international capital markets.
  
      The proposals involve introducing a set of interest margins
  on ECGD backed debt of 5/16 to 7/8 pct, depending on the size
  and maturity of the credit and the currency.
      The banks are likely to push for a higher margin. Bankers
  said that while these rates would reduce a bank's return they
  would still be more than those proposed about a year ago when
  the government attempted unsuccessfully to initiate another
  cost reduction plan.
      At the same time, the banks would be expected to allow the
  ECGD to realise additional savings by refinancing existing
  government backed credit in the capital markets.
  
      On credits that are refinanced an original lender would
  receive a residual margin of 7/16 pct for loans up to 10 mln
  stg and 3/16 pct on larger transactions.
  

