Pennsylvania Small Business is First to Benefit From Ex-Im Bank Medium-Term
Delegated Authority Program to Win Mexican Sale (Mar 2009) (continued)
Under the Ex-Im Bank program, approved lenders can increase use of Ex-Im Bank's medium-term guarantees supporting commercial loans for foreign buyers of U.S. capital goods such as machinery and equipment. The program is designed to significantly reduce transaction turnaround time and provide additional support for U.S. small-business exports.
Lenders approved for the program have delegated authority to underwrite and authorize Ex-Im Bank-guaranteed medium-term transactions without prior Ex-Im Bank review and approval. In each transaction, the lender will be required to share the credit risk by retaining 10 percent of the commercial risk but will also retain 10 percent of the Ex-Im Bank exposure fee. Transactions involving small-business exporters or small-business suppliers will be eligible for increased Ex-Im Bank risk coverage, and the lender's commercial-risk retention will be reduced to 8 percent. Lenders may also lay off half of the commercial risk retention to the exporter.
The participating lenders will have the thorough knowledge of Ex-Im Bank policies and credit standards to expedite approvals and help U.S. exporters offer timely financing to their foreign customers.
Loans approved under the program may have repayment terms of two to five years. Transactions requiring a higher degree of specialized judgment, such as those involving complex financing, environmental or economic-impact analysis, may be excluded. Excluded transactions may be submitted for consideration under Ex-Im Bank's standard medium-term guarantee program.
Interested lenders may contact Tom Fitzpatrick, Trade Finance and Insurance senior relationship manager, at (202) 565-3642, or Charles Goohs, senior Strategic Initiatives officer, at (202) 565-3790.
Ex-Im Bank is the official export-credit agency of the United States. The independent, self-sustaining federal agency, now in its 75th year, helps create and maintain U.S. jobs by financing the sale of U.S. exports, primarily to emerging markets throughout the world, by providing loan guarantees, export-credit insurance and direct loans.
In fiscal year 2008 Ex-Im Bank authorized $3.2 billion - more than 23 percent of total authorizations - in direct support of U.S. small businesses as primary exporters. The Bank approved 2,328 transactions that were made available for the direct benefit of small-business exporters. These transactions represented 86 percent of the total number of authorizations approved.