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Export-Import Bank of the United States Sean Mulvaney, Member of Board of Directors.

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Presentation on theme: "Export-Import Bank of the United States Sean Mulvaney, Member of Board of Directors."— Presentation transcript:

1 Export-Import Bank of the United States Sean Mulvaney, Member of Board of Directors

2 What is the United States Ex-Im Bank? What is the United States Ex-Im Bank? The official Export Credit Agency (ECA) of the U.S. Government The official Export Credit Agency (ECA) of the U.S. Government Self-sustaining and independent Self-sustaining and independent  Established in 1934  Headquartered in D.C.  Field team operating in three US regions with various service centers embedded in US Export Assistance Centers. Mission: To support US exporters and US jobs. Two-Fold Purpose: 1. Level the playing field for US exporters. 2. Assume credit and country risks that the private sector is unable or unwilling to accept

3 Support in Over 150 Countries 1. Brazil 2. Colombia 3. India 4. Indonesia 5. Mexico 6. Nigeria 7. South Africa 8. Turkey 9. Vietnam

4 Ex-Im Support Available To Variety of Industries ManufacturingManufacturing Construction EquipmentConstruction Equipment Medical EquipmentMedical Equipment MiningMining Power-generationPower-generation Aircraft and AvionicsAircraft and Avionics Services Renewable Energy Agribusiness Wholesale/Retail Oil Mining

5 Ex-Im US Exporter Bank of US Exporter Foreign Buyer Stakeholder Framework 5 Service or Good Export $ Payment Insurance Broker Bank of Foreign Buyer

6 Ex-Im Bank Financing Covers the Spectrum for US Exporters Pre-Export Financing Post-Export Financing Working Capital Guarantee Insurance Guarantees Direct Loans

7 NEED Exim Product SOLUTION Extension of Credit Working Capital GuaranteeFunds to Fulfill Orders Buyer Financing Medium- and Long-Term Insurance & Loan Guarantee Receivables Insurance US Business Export Finance Challenges You?

8 US Working Capital Guarantee Funds to pay for raw materials, labor, supplies, etc.Funds to pay for raw materials, labor, supplies, etc. 90% guarantee to lenders for export-related working capital loans90% guarantee to lenders for export-related working capital loans Transaction specific or revolving loansTransaction specific or revolving loans No minimum or maximum amountNo minimum or maximum amount

9 Advances are supported by export-related:Advances are supported by export-related: Inventory up to 75% Inventory up to 75% Receivables up to 90% Receivables up to 90% Term is generally one year (renewable) and may be up to three years.Term is generally one year (renewable) and may be up to three years. Working Capital Guarantee (cont.)

10 Ex-Im US Exporter Service or Good Export $ Payment US Exporter Bank Foreign Buyer Exporter Working Capital Product 10 Working Capital Guarantee WC Loan Facility Facility Fee Fees, Principal, and Interest Benefits to Exporter: 1. Resources to purchase intermediate inputs 2. Ability to post Standby Letter of Credit with reduced collateral requirements

11 11 Exporter Accounts Exporter Accounts Example

12 12 Exporter Accounts Exporter Accounts Example

13 13 Exporter Accounts Borrowing Base With Ex-Im Guarantee +$890,000

14 Short-Term, Accounts Receivable Insurance Protects U.S. exporters against nonpayment by foreign buyers due to: Protects U.S. exporters against nonpayment by foreign buyers due to: Commercial Risks Commercial Risks Political Risks Political Risks  Allows exporters to offer competitive credit terms to foreign buyers Generally up to 180 days, some 360 day terms Generally up to 180 days, some 360 day terms  Provides additional financing

15 Short-Term, Accounts Receivable Insurance (cont.)  Single or Multi-buyer Policies  Small Business Policy

16 Ex-Im US Exporter Insurance Broker Foreign Buyer Trade Credit Insurance 16 Trade Credit Insurance Service or Good Export $ Payment Benefits for Exporter: Reduces nonpayment risk Enables the extension of competitive credit terms to buyers Opens new markets Increases cash flow Roles of Broker: Helps exporter understand and fulfill Ex-Im requirements and business processes Agent/Representation of the exporter to Ex-Im Earns a commission from Ex-Im for use of authorized policies. Obligated to act in the best interests of client Commissions Insurance Policy Guidance Policy Premiums Representation of Exporter

17 Receivables Insurance Ex-Im Bank Success Story Holmatro, Inc. Glen Burnie, Maryland Makes hydraulic rescue equipment that is often used to save lives. Primary Export Markets: Peru, Brazil, and Canada Ex-Im Product: Multi-Buyer Export Insurance Policy supporting $1.8 million in sales. Results: Exporting sales process is now less costly and more efficient. Extending credit allowed Holmatro to sell more and enter new markets with confidence.

18 Buyer Financing (beyond 1 year) Used to finance foreign buyers purchasing U.S. capital equipment and services: Used to finance foreign buyers purchasing U.S. capital equipment and services: 85% financed, 15% cash down payment85% financed, 15% cash down payment Medium Term: insurance or guarantee products enabling repayment up to 5 years, exceptionally 7 years, amounts of $10 million or less.Medium Term: insurance or guarantee products enabling repayment up to 5 years, exceptionally 7 years, amounts of $10 million or less. Long Term: Loan guarantees available for long term financing of more than 7 years. (Note: few direct loans).Long Term: Loan guarantees available for long term financing of more than 7 years. (Note: few direct loans).

19 Ex-Im US Exporter Private Bank Foreign Buyer Buyer Financing Product (Insurance or Guarantee) 19 Guarantee or Insurance Service or Good Export $ Payment Exposure Fee Financing Facility Fees, Principal, and Interest Benefits: Obtain competitive term financing from lenders when: financing is otherwise not available or there are no economically viable interest rates on terms over 1-2 years Receive payment at the time of shipment Increased confidence to compete for sales in new markets

20 Buyer Financing Ex-Im Bank Success Story Maxson Automatic Machinery Company Westerly, Rhode Island "The loan guarantee made the commercial process more straightforward and easier." – Nick Datson, International Sales Manager

21 Ex-Im US Exporter US Exporter Bank Foreign Buyer Global Credit Express Product (Pilot Program for Small Business) 21 Direct Loan Fees, Interest, and Principal Referral Fee Customer Referral Benefits for Small Businesses: 1.Direct, fixed-rate financing with relatively low interest cost 2.Working Capital for export related expansion efforts, including marketing or sales related activities Service or Good Export $ Payment

22 Policy Considerations Non-competition with private sector lending. Non-competition with private sector lending. U.S. content requirements U.S. content requirements U.S. Flag shipping rules U.S. Flag shipping rules Effect on the environment (Ex-Im Guidelines) Effect on the environment (Ex-Im Guidelines) Military transactions not eligible with some exceptions. Military transactions not eligible with some exceptions.

23 Next Steps Packet contains additional information Packet contains additional information Product brochures, foreign buyer information.Product brochures, foreign buyer information. PoC Info: PoC Info: Sean Mulvaney 811 Vermont Ave NW, Washington DC (202)


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