US Ex-Im improves access to medium-term guarantees

The Export-Import Bank of the United States (US Ex-Im) has established a new programme to enable approved lenders to increase their use of the bank’s medium-term guarantees supporting commercial loans for foreign buyers of US capital goods such as machinery and equipment.

The programme aims to reduce transaction turnaround time and provide additional support for US small business exports.
Under the terms of the medium-term delegated authority programme, approved lenders will have delegated authority to underwrite and authorise US Ex-Im Bank-guaranteed medium-term transactions without having to first seek US Ex-Im bank approval.

In each transaction, the lender will have to share the credit risk by retaining 10% of the commercial risk, but will also retain 10% of the US Ex-Im Bank exposure fee.

Transactions for small business exports or suppliers are also eligible for the increased US Ex-Im bank risk coverage, and the lender’s commercial risk retention will be reduced to 8%.

"This new delegated authority programme will help US Ex-Im Bank expand medium-term financing for US exports and leverage our staff resources by working through approved lenders," comments US Ex-Im bank chairman and president, James Lambright.

"These lenders will have the thorough knowledge of our policies and credit standards to expedite approvals of Ex-Im Bank-guaranteed loans and help US exporters offer timely financing to their foreign customers."

US Ex-Im determines the level of delegated authority for each approved lender. Lenders can be approved for up to US$10mn per individual delegated-authority transaction, and up to US$100mn in aggregated delegated authority transactions.

Loans approved under the programme may have repayment terms of two to five years, and some transactions requiring higher levels of specialised knowledge or complex financing or environmental analysis might be excluded from the programme.