Worth reprinting from The Wall Street Journal:
Ex-Im Bank Scouts Out Future Export-Financing Deals
Chairman Fred Hochberg said he hopes the Senate can clear an impasse affecting a backlog of loan applications
Fred Hochberg, chairman and president of the Export-Import Bank speaks in New York on May 25.
By MARK MAGNIER
Aug. 9, 2016 1:46 a.m. ET
BEIJING—The U.S. Export-Import Bank is vetting major export-financing deals in advance so it can resume lending as soon as a U.S. Senate logjam is resolved, its chairman said Tuesday in Beijing.
Fred Hochberg, Ex-Im Banks’ chairman and president, said he hopes the Senate can clear an impasse during the next few months affecting a backlog of loan applications totaling some $20 billion at the Washington-based institution, which finances U.S. exports.
The bank has run into stiff opposition from critics who characterize as “corporate welfare” its support for U.S. exporters such as Boeing Co. Last year, the bank’s operations were suspended after House Republicans stopped Congress from voting on a reauthorization measure before its charter expired last July.
In December, large majorities in both chambers voted to renew its lapsed charter. But Sen. Richard Shelby (R., Ala.), the chairman of the Senate Banking Committee, has blocked the confirmation of a board member, depriving the bank of the quorum needed to approve deals exceeding $10 million.
The dispute illustrates the backlash that large companies are facing in Washington from a Republican Party that has grown increasingly populist. It is also the latest of several recent moves by Senate Republicans to shape policy using the nominations process.
While the bank can finance smaller deals, it has dozens of transactions over the $10 million threshold requiring board approval, Mr. Hochberg said. This has affected the bank’s global loan portfolio, including its China operations, and given an edge to export-import banks in other countries trying to convince U.S. companies to set up production on their shores where export financing is more predictable, he said.
Mr. Hochberg was in China to hold regular meetings with officials at the Export-Import Bank of China, leasing companies and the China Export & Credit Insurance Corp., or Sinosure. He said the Chinese officials found the U.S. legislative delays “confounding.”
Mr. Hochberg said he urged Sinosure and China’s Ex-Im Bank to sign on to international agreements aimed at creating a “level playing field” given the growing competition among some 85 export credit agencies around the world involving a “lots of side deals, cut-rate deals, things in the shadows that I don’t think are really good for the free exchange of goods and services.” So far, China has declined to sign on. “We’re a little disappointed at the pace of negotiations,” he said.
Ex-Im Bank Scouts Out Future Export-Financing Deals
Chairman Fred Hochberg said he hopes the Senate can clear an impasse affecting a backlog of loan applications
Fred Hochberg, chairman and president of the Export-Import Bank speaks in New York on May 25.
By MARK MAGNIER
Aug. 9, 2016 1:46 a.m. ET
BEIJING—The U.S. Export-Import Bank is vetting major export-financing deals in advance so it can resume lending as soon as a U.S. Senate logjam is resolved, its chairman said Tuesday in Beijing.
Fred Hochberg, Ex-Im Banks’ chairman and president, said he hopes the Senate can clear an impasse during the next few months affecting a backlog of loan applications totaling some $20 billion at the Washington-based institution, which finances U.S. exports.
The bank has run into stiff opposition from critics who characterize as “corporate welfare” its support for U.S. exporters such as Boeing Co. Last year, the bank’s operations were suspended after House Republicans stopped Congress from voting on a reauthorization measure before its charter expired last July.
In December, large majorities in both chambers voted to renew its lapsed charter. But Sen. Richard Shelby (R., Ala.), the chairman of the Senate Banking Committee, has blocked the confirmation of a board member, depriving the bank of the quorum needed to approve deals exceeding $10 million.
The dispute illustrates the backlash that large companies are facing in Washington from a Republican Party that has grown increasingly populist. It is also the latest of several recent moves by Senate Republicans to shape policy using the nominations process.
While the bank can finance smaller deals, it has dozens of transactions over the $10 million threshold requiring board approval, Mr. Hochberg said. This has affected the bank’s global loan portfolio, including its China operations, and given an edge to export-import banks in other countries trying to convince U.S. companies to set up production on their shores where export financing is more predictable, he said.
Mr. Hochberg was in China to hold regular meetings with officials at the Export-Import Bank of China, leasing companies and the China Export & Credit Insurance Corp., or Sinosure. He said the Chinese officials found the U.S. legislative delays “confounding.”
Mr. Hochberg said he urged Sinosure and China’s Ex-Im Bank to sign on to international agreements aimed at creating a “level playing field” given the growing competition among some 85 export credit agencies around the world involving a “lots of side deals, cut-rate deals, things in the shadows that I don’t think are really good for the free exchange of goods and services.” So far, China has declined to sign on. “We’re a little disappointed at the pace of negotiations,” he said.
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