The head of US Export-Import Bank blamed Republicans on Friday for delaying the renewal of the nearly 80-year-old bank's charter and said the inaction creates business uncertainty, thwarts exports and threatens jobs. "I do not know how this is going to end. We have been working hard for a year to get reauthorize because the Eximbank is a no-cost jobs bill," Eximbank President Fred Hochberg told Reuters. "This should have been done in September."
The Eximbank provides financing to help big US exporters like Boeing and many smaller companies make sales considered too risky by private banks. Its charter is generally renewed for four or five years at a time, but the bank has been operating on temporary authority since October.
The Republican group Club for Growth has branded the bank as "corporate welfare," and urged lawmakers to allow the bank to expire when its extension ends on May 31. Hochberg rejected that charge, saying the bank operates "at no cost to the taxpayers" since it collects fees on its loans that cover all of the bank's expenses. The bank has made a $1.9 billion profit over the last five years.
President Barack Obama's administration has also asked Congress to raise the bank's credit exposure cap to $140 billion, from $100 billion currently. A bill stalled in Congress would hike it to $135 billion. Hochberg said the most resistance to renewing the bank and raising the lending cap was from Republicans. "I think there are members of Congress who are concerned about any debt level," Hochberg said.
Unless Congress acts soon, the bank could hit its lending limit in six or so weeks, forcing it to stop making loans and putting future exports at risk, Hochberg said. Exporters have some $30 billion to $40 billion worth of deals that need financing, but the bank has only about $10 billion worth of lending ability left before it hits its ceiling.
"We're sitting here wringing our hands should (the credit cap) be $100 billion, $140 billion, $135 billion, and the competition is licking their chops, saying 'Boy, this is really great. We can scoop in and get a lot of sales that American companies don't have the financing for'," Hochberg said.