December 23, 2014
Export-Import Bank (Ex-Im Bank) Reauthorization
Background

What is the international context? Ex-Im Bank has many
foreign counterparts (see Figure 1). It abides by the
What is Ex-Im Bank? As the official U.S. export credit
Organization for Economic Cooperation and Development
agency (ECA), Ex-Im Bank finances and insures U.S.
(OECD) Arrangement on Officially Supported Export
exports of goods and services with the goal of supporting
Credits (the Arrangement), which establishes disciplines on
U.S. jobs. On a demand-driven basis, it seeks to support
the terms and conditions for government-backed export
exports that the private sector is unwilling or unable to
financing, such as minimum interest rates, risk fees, and
finance alone at commercially viable terms for exporting;
maximum repayment terms. The Arrangement is intended
and/or to counter government-backed financing offered by
to ensure that price and quality, not financing terms, guide
foreign countries through their ECAs. The rationales behind
purchasing decisions. Over time, unregulated ECA
Ex-Im Bank’s activities are subject to congressional debate.
financing has grown, as non-OECD countries provide
Ex-Im Bank Products
financing through their ECAs and OECD members provide
certain forms of financing outside the Arrangement’s scope.
Direct loan: Fixed-rate loan to foreign buyers of U.S. exports—
usual y capital-intensive exports (e.g., aircraft, mining equipment).
Figure 1. New Medium and Long-Term Official Export
Loan guarantee: Guarantee to a lender that, if default by the
Credit Volumes for Selected ECAs, 2013
buyer, payment of outstanding principal and interest on the loan.
Insurance: Protects U.S. exporters against risk of loss from non-
payment should a foreign buyer or other foreign debtor default.
Working capital: Short-term, secured working capital loans and
guarantees, usually to small businesses.
Special financing programs: Focus on a particular industry or
financing technique, e.g., aircraft, project, and supply chain finance.
What is the congressional interest? The FY2015
continuing resolution (CR; Sec. 147 of P.L. 113-164)
extends Ex-Im Bank’s general statutory charter (Export-
Import Bank Act of 1945, as amended) through June 30,
2015. Previously, the charter was to sunset on September
30, 2014. As the new sunset date approaches, Congress is

likely to debate whether to reauthorize Ex-Im Bank; if so,
Source: Ex-Im Bank, 2013 Competitiveness Report, June 2014.
under what terms; and if not, other policy alternatives.
Notes: Data subject to analytic assumptions and other limitations.
OECD ECAs unregulated financing may be omitted.
What are statutory requirements for Ex-Im Bank’
support? Under its charter, Ex-Im Bank’s financing must
What does its activity look like? According to Ex-Im
offer a “reasonable assurance of repayment” and should
Bank, in FY2014, it authorized $20.5 billion in credit and
“supplement and encourage, and not compete with, private
insurance transactions worldwide, to support an estimated
capital.” The Bank considers a proposed transaction’s
$27.5 billion of U.S. exports. U.S. small businesses account
potential U.S. economic and environmental impact, among
for the majority of Ex-Im Bank’s transactions by number
other policy issues. Based on its jobs mandate, it requires a
(89%), while larger companies represent the majority by
certain amount of U.S. content (85% for medium- and long-
dollar amount. In FY2014, the Bank’s worldwide exposure
term transactions) for an export contract to receive full
reached a reported $112.0 billion, under the statutory limit
financing from the Bank. In addition, products generally
of $140 billion for that year (see Figure 2).
must be shipped on U.S. flag vessels. Congress further
requires Ex-Im Bank to support certain types of exports.
How does it manage risk? The Bank assesses credit and
For example, the Bank must make available not less than
other risks of proposed transactions, monitors current
20% of its total authority to finance small business exports,
commitments for risks, and maintains reserves against
and not less than 10% to finance renewable energy-related
losses. It reported a default rate of 0.175% as of September
exports. It also must promote financing to sub-Saharan
2014 (provided quarterly to Congress), and, since 1992, an
Africa, but does not have a quantitative target. While the
average recovery rate of 50% for transactions in default.
Bank seeks to support these export goals, it is demand-
driven, and its activity depends on alignment with
What is its appropriation? The Bank’s revenues include
commercial interest and opportunities.
interest, risk premia, and other fees it charges for services.
www.crs.gov | 7-5700





Export-Import Bank (Ex-Im Bank) Reauthorization
Such revenues in excess of forecasted losses are recorded as
In the 113th Congress, the FY2015 CR includes an
offsetting collections. As part of the annual appropriations
extension of Ex-Im Bank’s authority through June 30, 2015.
process, Congress and the President set an upper limit on
This followed active debate about Ex-Im Bank’s
the amount of these offsetting collections available to Ex-
authorization status. Proposals in Congress included a
Im Bank to fund its operations; provide a direct
largely “clean” reauthorization of the Bank; reauthorization
appropriation for its Office of Inspector General (OIG); and
with reforms; and termination of authority. The Obama
allow it to retain funds for a period of time. For FY2015,
Administration’s April 2014 legislative proposal called for
the Bank has an upper limit of $106.3 million for
a five-year renewal of the Bank’s authority and an increase
administrative expenses, funding of $5.8 million for the
in its exposure cap to $160 billion by FY2018.
OIG, and up to $10 million in carryover authority until
September 30, 2018 (P.L. 113-235). Ex-Im Bank reported
Reauthorization Issues for Congress
providing $674.7 million to the Treasury in FY2014 after
covering operating expenses.
The primary issue is whether to reauthorize Ex-Im Bank.
Scenarios include renewing its authority, in a “clean”
Figure 2. Ex-Im Bank FY2014 Exposure Composition
manner or with reforms; allowing its authority to sunset;
and reorganizing its functions, such as merging with other
agencies. Renewal presents other issues, including:
Length of reauthorization. Shorter extensions of
authority in the past arguably have given Congress the
opportunity to weigh in more frequently on Ex-Im Bank
operations through the lawmaking process, while longer
extensions could enhance the Bank’s long-term planning
and assure clients of the Bank’s viability.
Policies. Possible revisions to Ex-Im Bank’s policies
could be viewed in the context of the agency’s
effectiveness and efficiency in meeting its statutory
mandate and other requirements; the competitiveness of
its policies relative to those of foreign ECAs;
implications for business, labor, environmental,
taxpayer, and other stakeholder interests; and adequacy
of reforms undertaken since the 2012 reauthorization.
Financial soundness and risk management. Ex-Im
Source: Ex-Im Bank, FY2014 Annual Report.
Bank’s financial soundness is of increasing interest as
Reauthorization Debate and Outcome
its exposure levels have grown. Congress may consider
the Bank’s credit standards, due diligence, and other
practices in terms of goals such as allowing the Bank to
What is the general debate? While Congress has renewed
prudentially manage risk and minimize potential
Ex-Im Bank’s authority many times, reauthorization is
taxpayer losses, while enabling it to take on appropriate
subject to increasing debate—coinciding with questions
risks to meet its U.S. exports and jobs mandate.
over the role of the U.S. government in supporting exports,
the appropriate size and scope of the government, and other
International disciplines. The growth in unregulated
issues. Proponents contend that the Bank supports U.S.
financing raises questions about the effectiveness of the
exports and jobs by filling in gaps in private sector
OECD Arrangement. Some stakeholders support a focus
financing and helping U.S. exporters compete against
on bringing China and other non-OECD countries into
foreign companies backed by their ECAs. Critics contend
the Arrangement. Some also support U.S. and Chinese
that it crowds out private sector activity, picks winners and
efforts since 2012 to negotiate separate export credit
losers through its support, operates as a form of corporate
disciplines as part of an International Working Group.
welfare, and poses a risk to taxpayers.
Others call for a focus on U.S. efforts in the OECD and
other venues to negotiate to reduce and eliminate
What has been the outcome of recent debates? In the
government-backed export financing internationally.
112th Congress, legislation (P.L. 112-122) was passed on a
bipartisan basis (House vote 330-93; Senate vote 78-20) to
See CRS Report R43671, Export-Import Bank
extend Ex-Im Bank’s authority through FY2014 and
Reauthorization: Frequently Asked Questions, coordinated
incrementally increase its exposure cap from $100 billion to
by Shayerah Ilias Akhtar; and CRS In Focus IF00039,
$140 billion in FY2014, subject to conditions. It required
Export-Import (Ex-Im) Bank and the Federal Budget (In
the Bank to monitor its default rate and take specific action
Focus), by Mindy R. Levit.
if it equals or exceeds 2%; develop guidelines for its
economic impact analysis; and review its domestic content
Shayerah Ilias Akhtar, siliasakhtar@crs.loc.gov, 7-9253
policy. Among other things, it also required the Secretary of

the Treasury to negotiate internationally to reduce and
IF10017
eliminate government-backed export credits.
www.crs.gov | 7-5700