Risk Safety Net

I refer to your Nov. 9 article “Imperial Tames Its Act,” in which you mentioned that Imperial Bank “also remains an active lender in other higher-risk areas.” Following that statement you note that it was ranked as the nation’s fifth most active working capital lender in the export industry, according to Ex-Im Bank.

I would like for your readers to be fully aware that the Export-Import Bank of the U.S. (“Ex-Im Bank”) is an independent federal government agency that promotes and assists in financing the sales of U.S. goods and services to markets worldwide. As its official export credit agency, we act with the full faith and credit of the U.S. government and, as such, have a mandate to absorb most or all of the risk of non-payment by foreign buyers in international trade transactions.

Our support of an export transaction actually lowers a bank’s risk, despite the fact that the transaction may be in a high-risk emerging market. Trade transactions in general consistently enjoy the highest rate of repayment. In fiscal 1997 (latest available statistics), Ex-Im Bank provided $443 million in working capital guarantees which supported over $1.3 billion in export transactions. Our claims rate as a percentage of authorizations was a mere 2.8 percent.

Your article might be misconstrued as to imply that Imperial Bank was engaging in high-risk lending activity by being an active lender under our Working Capital Guarantee Program, while, quite to the contrary, the bank was greatly mitigating its risk.

In fiscal 1998, Ex-Im Bank helped to finance $12.9 billion in U.S. exports.

JERRI SLIFER

Regional Director, West Office

Export-Import Bank of the United States