Export-import bank's focus could help cleantech clean up - Silicon Valley / San Jose Business Journal:

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"It's the best hidden secretg in the world ofinternational finance," says Mike head of products for Silicon Valley Bank and a member of the Ex-Imk Bank's advisory board. "(Th bank's) widely known with the majors: the Caterpillars and folks that have been usin g themfor years. But with small and mid-sizer businesses, they're letting people know they're availabler to help banks financeoverseas transactions." Commonlt known as the Ex-Im Bank, it provides loan guarantee s to partner banks, including Silicon Valley to finance exports.
The Ex-Im Bank also providez export credit insurance that can protec borrowersagainst non-payment by foreign But with just about 400 employees, the 71-year-oldd Ex-Im Bank is a largeluy unknown federal agency that has struggled to get the word out abouty its programs to emerging "We assume risks the private sectofr is unwilling or unable to take says Linda Conlin, vice president and vice chair of the U.S. Export-Imporyt Bank. "We want to make sure we help to leve l the playing fieldsto U.S. exporters by matching the financing otherf governments provide totheir exporters.
" The bank is rampinf up its focus on California clean technologhy companies in the coming year because its chartef says it must focus on financinhg renewable energy solutions. The current credit cruncu has created an opportunity for the bank because it is not limitedd by the number of loans it can make or the size of the loan it can Conlin says. "We've done over $1 billionm last year in working capitalloan guarantees," Conlim says. "Most of that has gone to small And clean tech and environmental companies make up the majoritg ofthese companies.
" Ex-Im Bank's loan guarantees, like Small Businessz Administration loans, are attractive to banks becaus e they don't require banks to reservw capital against the loan like bankz do for unguaranteed commercial "The reason Ex-Im Bank exists is banks are somewha t constrained in their ability to finance cross-borde sales," says Craig director of Ex-Im Bank's Office of Renewabl Energy and Environmental "The element of risk is somewhat If a bank makes an international loan, it has to hold back a high loan loss But if we're giving them a loan that's 100 percent unconditional.
That means the bank has zero loan loss enabling banks to extend longer terms at lower interest rates and thisgives U.S. exporters a decides advantage in supportingtheir sales." Selfridge says given the credit crunch, banks will likely want to free up as much capitak as they can in the coming "I think you're going to see banks get much sharper in takingb on the right kinds of risk and capital So to me there will be big opportunitied in 2008 and 2009 ... with the whole credir crisis going on," Selfridge says. The Ex-I Bank also offers a program specific to renewable energy and water projects wher companies can qualify for extended repayment terms of up to15 years.
, a Berkeley-bases solar company which was purchasedby , used the extendedx financing terms to develop an $8 millionn solar-panel project in South Koresa in 2006. In 2007, the bank authorizedd $12.6 billion in loan commitments, which supported an estimated $16 billion in U.S. the bank says. "U.S. clean and renewable energyy exports doubled between 2002 and Conlin says. "So it's a growtg industry and there are many companies in this sectof that are going global at an earlier time in theit development than a typical startup oryounyg company. That's where we can be particularly helpful." The Ex-I m Bank is also eyeing the venture sector for leads oncleantecn deals. U.S.
venture capital investment in the cleantech spac e has jumpedto $5.1i8 billion from $714 million in North America and Europew between 2001 and according to the CleanTech Group. And U.S. companiez receive more than three times the investment that Europeancompaniesz do. "We have a real interesty in reaching into the venturee capital community because we reallyfeel like, in a certain stagde of a company's development, we can be very helpful," Conlin says.