This study presents a series of innovative financial products for the customers of the Agricultural Bank of Greece (ABG) which aim at reducing the bank’s loan delinquency rate, making the loans more attractive by lowering their rates and eventually helping ABG increase its market share. The most important source of credit risk is the volatility in the price of agricultural goods between their production, processing and sale. The project examines the institutional framework and the international financial markets for five agricultural products of vital importance for the Greek economy. The project team designed, structured, analysed, and assessed a series of novel structured finance and commodity derivative products for these agricultural goods. Having analysed the advantages and disadvantages of each method for hedging the underling’s price volatility, three innovative for the Greek agricultural market financial products are proposed.
The adoption and use of the proposed products will allow ABG to answer the needs of its clients by offering customised and attractive solutions to their problems, increase its presence in the Greek financial market and improve its financial performance.