May 17 (Bloomberg) -- U.S. Export-Import Bank Chairman Fred Hochberg asked Congress for a 40 percent increase in the loan limit to $140 billion for fiscal year 2015 as borrowing by companies closed in on the current maximum.
“We need an increasing exposure cap to continue to support American companies as they compete overseas,” Hochberg told the Senate Banking Committee in Washington today at a hearing on the government-backed lender’s reauthorization.
The Export-Import Bank, which is independent and self-sustaining, provides financing to U.S. exporters, including direct loans, guarantees and payment insurance. The bank has loaned $78 billion out of $100 billion allowed, and outstanding loans probably will exceed $80 billion this year, Hochberg said in an interview after testifying to the committee.
Demand for bank support from companies such as General Electric Co., KBR Inc., Caterpillar Inc. and Boeing Co. surged after the financial system seized up in 2008 and banks tightened borrowing requirements. The lender is chartered by Congress and needs its authority to be renewed in order to operate beyond Sept. 30, when its five-year approval expires.
Senate Banking Committee Chairman Tim Johnson, a South Dakota Democrat, said he’s hopeful the reauthorization will be granted by September.
“I don’t see any controversy surrounding this issue, but you never know,” Johnson said in an interview.
Hochberg said he’s working with Johnson and Representative Gary Miller, a California Republican who heads the House Financial Services Committee panel that oversees the bank, and is “confident we’re on the right path” for approval before the fiscal year ends.
The bank asked Congress in legislation submitted yesterday to raise the loan limit by $10 billion a year through 2015 to reach $140 billion, Hochberg said. New loans will climb to a record for a third year, he said, repeating a March forecast. The lender provided $24.5 billion in new financing in the 2009-2010 fiscal year, and will exceed that this year, he said.
To contact the reporter on this story: Eric Martin in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Larry Liebert at email@example.com