Export-Import Bank of the United States (Ex-Im Bank)
Updated January 19, 2024
Export-Import Bank of the United States (Ex-Im Bank)
Ex-Im Bank, the official U.S. government export credit
• working capital guarantees of short-term loans to U.S.
agency (ECA), has a mission to support U.S. jobs by
exporters.
financing and facilitating U.S. goods and services exports.
Some deals may use underwriting techniques such as
Operating under a renewable, general statutory charter
project, structured, and supply chain finance.
(Export-Import Bank Act of 1945, as amended; 12 U.S.C.
§§635 et seq.), it aims to support U.S. exports when the
Specific programs and initiatives include:
•
private sector is unwilling or unable to provide financing,
China and Transformational Exports Program (CTEP),
and/or when U.S. exports compete overseas against exports
established in the 2019 reauthorization, which aims to:
from other countries backed by foreign ECAs.
(1) counter export subsidies and finance provided by the
Export Financing Background
People’s Republic of China (PRC, or China), or other
Exporters may face commercial and political risks of buyer non-
designated countries; or (2) advance U.S. comparative
payment, as well as challenges attracting sufficient capital (e.g., for
leadership with respect to the PRC, or support U.S.
infrastructure projects). Export financing can help to mitigate
innovation, employment, or technological standards in
risks and increase liquidity for exports. It may be available
statutory “transformational” export areas (e.g., artificial
through various channels, including commercial banks. National
intelligence, 5G, renewable energy, semiconductors).
governments also may provide such financing through their ECAs
• Make More in America (MMIA), approved by the Board
to fil gaps in private sector financing and/or advance other policy
in 2022, which provides financing for “exported-
goals and strategic interests. Ex-Im Bank is among at least 116
oriented” domestic manufacturing projects that also
known ECAs globally, which vary in size, policies, and activity (see
meet other criteria, as part of Biden Administration
Ex-Im Bank, 2022 Competitiveness Report, June 2023).
efforts to strengthen U.S. supply chains. While open to
Agency Overview
all sectors, MMIA prioritizes transformational exports,
Authorization. In 2019, Congress extended the Bank’s
small business, and environmentally beneficial projects.
general statutory authority for seven years, through
Statutory and Policy Requirements. Bank financing may
December 31, 2026 (P.L. 116-94, Div. I, Title IV). Absent
be extended only where there is a “reasonable assurance of
reauthorization, the Bank generally would be unable to
repayment” and must supplement, not compete with,
approve new transactions, but it would be able to continue
private capital. The Bank must be “fully competitive” with
managing its existing financial obligations, and perform
foreign ECA rates, terms, and other conditions. It must
certain other functions for “an orderly liquidation.”
consider a proposed transaction’s potential economic
Leadership. A five-member Board of Directors leads the
impact to U.S. industry and its environmental impact. It
Bank, with members presidentially appointed, Senate-
also has U.S. flag shipping and other requirements.
confirmed, and no more than three from any one political
The Bank, which views the U.S. content in an export
party. The Bank’s President and First Vice President serve,
contract to be a proxy for U.S. jobs supported, reduces its
respectively, as the Board’s Chair and Vice Chair. The
level of support based on the foreign content in an export
Board needs a quorum of at least three members to conduct
contract. It has a CTEP-specific content policy for Bank
business, such as to approve transactions above a certain
financing at a lower domestic content threshold.
threshold, make policies, and delegate authority. The 2019
Per sector-specific statutory mandates, Ex-Im Bank must:
reauthorization provided alternative Board procedures in
• make available not less than 30% of its total financing
the event of a quorum lapse. The Board currently has four
authority each year to support small business exports;
filled positions, including the President/Chair and First Vice
• make available not less than 5% of its total financing
President/Vice Chair; three terms expire in January 2025
authority each year to support renewable energy, energy
and one in January 2027. By statute, an Advisory
efficiency, and energy storage technology exports; and
Committee and a Sub-Saharan Africa Advisory Committee
• aim to reserve up to 20% of its total financing authority
support the Board. The Bank also has created advisory
for support pursuant to CTEP.
subcommittees on issues such as competition with China.
It also must support environmentally beneficial exports and
Programs. The Bank’s activities are demand-driven, fee-
exports to sub-Saharan Africa (no percentage requirement).
based, and backed by the full faith and credit of the U.S.
Funding. Ex-Im Bank’s revenues include interest, risk
government. Key general programs include:
•
premia, and other fees charged for its support. Revenues
direct loans to foreign buyers of U.S. exports (interest
acquired in excess of forecasted losses are recorded as
rates based on spreads set in international rules above
offsetting collections. The Bank reports contributing to the
Treasury rates);
• loan guarantees to lenders against default on loans to
Treasury, since 1992, a net of $9.0 billion after covering
foreign buyers of U.S. exports (lender usually sets rate);
expenses, loan-loss reserves, and administrative costs. (This
• insurance to protect U.S. exporters or financial
is on a cash basis, and different from the amount calculated
institutions against export-related risks; and
on a budgetary basis.) Offsetting collections did not fully
cover costs in FY2018-FY2023. For FY2023 (P.L. 117-
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link to page 2
Export-Import Bank of the United States (Ex-Im Bank)
328), the Bank had a $125.0 million limit for administrative
debate over the impact of easing content policies on U.S.
expenses, $15.0 million for programs, and $7.5 million for
exports and jobs supported).
its Inspector General (IG). The FY2024 budget request has
Unregulated ECA financing has grown as non-OECD
a $136.3 million limit for administrative expenses; $31.0
countries operate ECAs and OECD members provide
million for programs, and $8.9 million for the IG.
financing outside of the OECD rules. China’s ECA activity
Activity. For FY2023, the Bank authorized $8.8 billion (see
raises particular concerns due to its purported size and
Figure 1), to support some $10.6 billion of U.S. exports. As
scope, financing tactics, limited transparency, and operation
a share of total authorizations, small business comprised
outside of OECD rules. An effort among the United States,
23.0% by dollar amount and 87.2% by number; and
the PRC, and others to develop new export credit rules
renewable energy comprised 10.4% and CTEP comprised
halted in 2020 over differences (e.g., transparency).
27.8%, both by dollar amount. (A transaction can support
In 2022, official medium- and long-term export credit
multiple mandates.) A Board quorum lapse (July 2015 to
financing rose globally by 26% from 2021. The PRC
May 2019) previously constrained Bank financing.
remained dominant, but for the first time since 2012, it was
Figure 1. Ex-Im Bank Authorizations, FY2010-FY2023
not the largest ECA financing provider (Figure 2).
Figure 2. Export Financing by Selected ECAs in 2022
Source: CRS, based on data from Ex-Im Bank annual reports.
Note: FY2023 authorization number estimated using other data.
Risk Management. The Bank monitors credit and other
transaction risks, reserves against losses, and reports its
default rate quarterly. If its default rate reaches 2%, it faces
an immediate lending cap freeze. At the end of FY2023, the
Source: Ex-Im Bank, 2022 Competitiveness Report, June 2023.
Bank had loss reserves of $2.3 billion (6.7% of exposure),
Note: Data are for new medium- and long-term official export credit
and a default rate of 0.983%. The FY2024 budget request
financing, and subject to analytic assumptions and other limitations.
proposes a temporary increase of the default rate cap from
*Brazil abides by the Arrangement’s Aircraft Sector Understanding.
2% to 4% to give the Bank more flexibility to compensate
Policy Debate and Issues for Congress
for possible portfolio effects from current global economic
Ex-Im Bank is subject to policy debate. Supporters argue
and political issues and support U.S. competitiveness.
that it fills gaps in private-sector financing and helps U.S.
Global Rules and Activity. The Bank abides by the
firms compete against foreign ECA-backed firms, while
Organisation for Economic Co-operation and Development
managing risks and advancing U.S. policy goals. Critics
(OECD) Arrangement on Officially Supported Export
argue that it crowds out the private sector, picks winners
Credits, first established in 1978 to ensure a level playing
and losers, is corporate welfare, and poses taxpayer risks.
field for exporter competition. The OECD Arrangement
In the 118th Congress, some bills would advance Bank
applies to ECA financing with repayment terms of two
support for specific purposes (e.g., critical minerals and
years or more. It sets limits on financing terms and
energy supply chains in S. 458 and S. 2226 as engrossed in
conditions, and includes provisions on transparency and
the Senate [but not in the final law, P.L. 118-31]; for CTEP,
tied aid (concessional financing linked to procurement from
add nuclear energy and ease default rate-related limits, S.
the donor country). Per the World Trade Organization
1928) or further restrict Bank support (e.g., for Iran, H.R.
(WTO), Arrangement-compliant export credit practices are
5921). Looking forward, Congress could assess:
not deemed prohibited export subsidies.
• the Bank’s competitiveness in supporting U.S. exports,
Differences among ECAs’ programs and policies may
balanced with its risk management practices, in general
enhance their competitiveness if they afford ECAs greater
and as a potential reauthorization debate nears;
implementation flexibility. For example, many ECAs have
• the effectiveness of the relatively new CTEP and
eased or removed domestic content requirements, partly
MMIA, the Bank’s support for other export focuses, and
because of more globalized input sourcing. Many U.S.
trade-offs to potential changes to focus area mandates;
•
exporters, while lauding the Bank’s programs and policies
options to address “unfair” competition from foreign
in other respects, also view its default rate cap and foreign
ECAs under existing rules and potential new tools; and
•
content approach as key competitiveness barriers. Policy
the Bank’s coordination with other U.S. trade financing
changes may raise competing stakeholder interests (e.g.,
and promotion agencies and with foreign ECAs.
https://crsreports.congress.gov
Export-Import Bank of the United States (Ex-Im Bank)
•
IF10017
Shayerah I. Akhtar, Specialist in International Trade and
Finance
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https://crsreports.congress.gov | IF10017 · VERSION 34 · UPDATED