FINANCING PROGRAMS OF THE EXPORT-IMPORT BANK OF THE UNITED STATES

MAJOR PROGRAMS 1.Direct Loans Granted in dollars to exporters/foreign based U.S. affiliates repay interest + principal for larger projects (e.g. aircraft) requires private participation

MAJOR PROGRAMS 1.Direct Loans (con’t) borrower has sufficient financials project should be self-supporting no adverse environmental impact

MAJOR PROGRAMS 2.Guarantees for U.S. Financial Institutions for loans which require U.S. guarantee Ex-Im guarantees 100% of loans granted unconditionally amount paid if in default by more than 30 days

MAJOR PROGRAMS 3. Guarantees for Non- U.S. Financial Institutions if U.S. funds are not available non-U.S. = –foreign branches of U.S. banks –U.S. trading company foreign offices –non-U.S. banks

MAJOR PROGRAMS 4.Commercial Bank Exporter Guarantees ExIm extends guarantee to cover –100 % of political risk –90 % of commercial credit risk

MAJOR PROGRAMS 5.Short Term Discount Program a financing source on payment terms of 365 days or less discounting of export paper longer than 180-day bankers’ acceptances banks take on full commercial and political risk

MAJOR PROGRAMS 6.Obtaining a Preliminary Commitment when exporter needs to present a financing plan before sale foreign buyers want to terms and conditions under which financing will be available

MAJOR PROGRAMS 7.Working Capital Guarantee Program Problem: lack of working capital source encourages lenders to extend loans to finance export-related production covers bank from exporter default not importer

MAJOR PROGRAMS 7.Working Capital Guarantee Program (con’t) Eligible exporters –small and middle-sized companies without available funds Eligible lenders –must have ability and resources to service the loan Eligible Use of Proceeds