The Export-Import Bank of the United States (US Exim) has given a US$343.3mn direct loan to Asia Satellite Telecommunications (AsiaSat).

The loan will be used to purchase two communications satellites, manufactured by Space Systems / Loral LLC in California. It marks a continuation of US Exim’s growing support for the satellite industry which John Schuster, vice-president of structured finance, tells GTR is necessary due to the retrenchment of commercial banks from the market.

Schuster says that since 2008, private financing has been expensive and hard to attain for companies in the industry, a sentiment borne out by the escalating amount of liquidity the bank is pumping into it.

In 2008, US Exim lent around US$50mn to the satellite sector. For the past three years, that figure has increased to over US$1bn; with the bank poised to break the billion-dollar mark in 2013 too. And with private banks showing little sign of returning, it’s likely that the market will continue to be propped up by ECA finance.

Schuster says that the pricing in the market is a result of “harsh” credit ratings. He explains: “Ratings for satellites and telecoms have been fairly harsh. A number of strong performing companies in the satellite industries, with good revenues, have low ratings because of a perception of technological risk. I see what I consider to be overly harsh rating of the sector, which makes them harder on satellites.”

Banks and agencies, says Schuster, have failed to distinguish between the geostationary, lower orbit and mid-earth orbit satellite markets, each of which comes with different levels of risk. He also suggests that banks are “more focused on the larger sectors”, such as oil and gas, power and mining.

US Exim’s support for the satellite sector has increased twentyfold in recent years, and based on the current state of the lending market, it’s expected that this figure will hold for the foreseeable future.