Huayi Brothers pact with Sinosure to protect pic
Chinese shingle Huayi Brothers has signed an export credit insurance policy supplied by specialist insurer Sinosure for its upcoming Ziyi Zhangstarrer “The Banquet,” the first such deal in China, according to Sinosure VP Zhou Ji’an.
While export credit policies are common in other businesses, Chinese movie budgets are rarely large enough to carry the cost of policies, and most Chinese movies are not expected to generate significant foreign revenues.
With presales for several territories put in place by Huayi’s inhouse sales team and by Hong Kong co-financier Media Asia, “Banquet” was able to generate RMB50 million ($6.25 million).
Pic, helmed by Feng Xiaogang, was made on a production budget of more than $20 million and Japanese deal with distrib Gaga Communications north of $5 million. Film preems out of competition at the Venice Film Festival, which begins on Wednesday.
Huayi will use export credit insurance on most of its future titles, according to shingle’s spokesman.
Zhou says insurance policies that underwrite foreign earnings free Chinese filmmakers from having to accept lump-sum deals when licensing territory rights.
With the risk shouldered by the insurance company, producers can strike minimum guarantee deals with distribs and participate in B.O. upside.
Export credit policies played major role in the growth of South Korea’s film industry, Zhou said.