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Small business is big business at the Export-Import Bank of the United States (Ex-Im Bank). As the official export credit agency of the United States, Ex-Im Bank is sustaining high-quality American jobs by helping increasing numbers of small- and medium-sized U.S. companies to expand export sales and services into foreign markets. This federal agency's small business activity has increased dramatically since 1992, with over 80 percent of Ex-Im Bank's transactions supporting small businesses in fiscal year 1996. Last year, Ex-Im Bank supported 1,934 small business transactions, and 411 small businesses were first-time users of the Bank's programs.

Ex-Im Bank provides financing for U.S. export sales that would not happen otherwise. Ex-Im Bank only steps in where U.S. exports and jobs are endangered by foreign trade practices, contrary to a free market system. Ex-Im Bank levels the playing field for U.S. companies facing subsidized foreign competition. Through loans, guarantees, and export credit insurance programs, Ex-Im Bank moderates risk for exporters while still assuring them that they will be paid. Ex-Im Bank programs also enable private lenders to provide export financing for smaller companies.

"Ex-im Bank is aggressively reaching out to small business throughout the United States to help them compete in the global market-place and sustain U.S. jobs. We want to ensure that no innovative small company loses the opportunity to make a foreign sale because it lacks working capital or competitive export financing," said Maria Luisa Haley, Ex-Im Bank Board Director, whose area of responsibility is small business.

One of the principal ways that Ex-Im Bank supports smaller U.S. firms is through its Working Capital Guarantee Program (WCGP), which works in harmony with the SBA Export Working Capital Program. Ex-Im Bank's WCGP helps exporters to obtain the working capital needed to purchase inventory or raw materials, to manufacture, or to market exports. Under the WCGP, Ex-Im Bank provides repayment guarantees to lenders on secured, short-term working capital loans made to qualified exporters. The guarantee may be approved for a single loan to a revolving line of credit. If the exporter defaults on the loan, Ex-Im Bank will cover 90 percent of the principal of the loan and interest up to the date of claim payment at the stated rate on the loan. In fiscal year 1996, the Bank approved a record $378 million in financing under the WCGP.

Under Ex-Im Bank's Delegated Authority Lender Program, lenders are allowed to approve loans and commit Ex-Im Bank's guarantee to working capital financing for U.S. small- and medium-sized business exporters, without prior Ex-Im Bank approval. The program was introduced in October 1994 and was an immediate success. In its first year, 50 percent of all Ex-Im Bank transactions were done under delegated authority. That number has now grown to 80 percent. The Delegated Authority Lender Program empowers commercial and community banks, as well as non-bank lenders, to make decisions quickly at the local level. By "cutting red tape," the program allows tenders to work within their own time frame.

MWI Corp. of Deerfield Beach, Fla., is an example of a small business that has grown with the aid of Ex-Im Bank's WCGP. MWI, a family-owned company since 1926, makes pumps and other water-related equipment sold worldwide. MWI sales have quadrupled and its workforce has tripled to 250 employees since receiving its first commitment from Ex-Im Bank in 1983. MWI was recently presented with Ex-Im Bank's 1997 Small Business Exporter of the Year award.

Ex-Im Bank's financing during 1994 through 1996 helped a small engineering and computer software firm grow. Modular Mining Systems, Inc. of Tucson, Ariz. made an important foreign sale to Chile. Modular hired an additional 30 employees, raising its total staff to 180 workers.

"In 1994 and 1995, we went through a period when we probably would not have survived without Ex-Im Bank," said Steve Meiller, controller of Modular Mining Systems. "We had good growth in sales to large-scale, long-term projects, but we needed working capital in order to fill the orders. Customers are reluctant to pay ahead, and the banks weren't interested. Ex-Im Bank's financing sustained us through the better part of two years."

Modular has become so successful that it no longer needs Ex-Im Bank financing but continues to use the Bank's insurance programs to mitigate political and commercial risks of exporting.

Small business exporters are not just concerned with obtaining working capital; they are also concerned about taking credit risks on foreign buyers. Ex-Im Bank's export credit insurance protects against foreign buyer default for commercial or political reasons. This program is a key support to small- and medium-sized companies, and has long been a success with exporters of raw materials, consumer goods, and agricultural products. In recent years, exporters of capital equipment and other goods have also taken advantage of the Bank's medium-term insurance policy, which supports sales generally on terms of one to five years, and under special circumstances even longer.

In fiscal year 1996, Ex-Im Bank approved $3.8 billion in insurance authorizations in over 1,900 transactions. Small business transactions comprised 87 percent of total Ex-Im Bank policies approved.

Poof Products of Plymouth, Mich., a small business of 45 employees, increased export sales with the assistance of Ex-Im Bank's export credit insurance. Poof Products manufactures foam toys in nearly every imaginable shape. The company already has a strong domestic market but saw a need to expand sales to foreign buyers in Canada, Mexico, and New Zealand. For the past five years, Poof has been using Ex-Im Bank's short-term multi-buyer insurance policy to cover the risks of nonpayment.

Taylor Machine Works International, Inc., a small Annandale, N.J. exporter of heavy-duty forklift trucks, is another example of a company that has benefited from Ex-Im Bank's export credit insurance. An Ex-Im Bank multi-buyer insurance policy alleviated the risk of overseas receivables and enabled Taylor to offer credit terms on the same level as its foreign competitors. The company's foreign sales jumped from $3 to $4 million in 1990 to $18.5 million in 1996, with the aid of Ex-Im Bank. Taylor Machine Works International boosted overseas sales by 500 percent in six years.

Ex-Im Bank's City/State Partners Program is a cooperative effort by Ex-Im Bank and 33 state and local government offices and other organizations to bring the Bank's programs to the exporter at the lowest cost to the American taxpayer. Ex-Im Bank's City/State Partners have the staff and the knowledge of the local market to reach out to exporters. They provide efficient access to Ex-Im Bank's loans, guarantees, and insurance programs, and assistance on working with local lenders. By pooling strengths, Ex-Im Bank and its City/State Partners accomplish what neither could do alone -- enable U.S. companies to compete in foreign markets and create high-quality jobs.

Ex-Im Bank trains the staff of its City/State Partners to market Ex-Im Bank's programs to local businesses and commercial banks, to teach seminars, to counsel exporters and banks, and to package transactions. Packaging a transaction is often too expensive for a bank to do on its own. By providing this service, City/State Partners facilitate many commercial loans that otherwise would not go forward.

The City/State Program is a continuing success. In the past five fiscal years, the number of transactions the Bank completed under this program increased nearly 410 percent from 72 to 367, with the dollar volume increasing 129 percent from $119 to $273 million. City/State partners are making exporting a reality for small businesses.

More information on the Bank's programs for small business is available by calling the toll-free number, 1-800-565-EXIM (3946), or by accessing the Bank's Internet web site at http://www.exim.gov.