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Boeing, Citibank
Start Export-Import Bank Supplier Financing Program By Shane Nolan |
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February 18, 2012 - Boeing has become the latest U.S.
exporter to help its eligible small-business suppliers
gain access to affordable financing through
participation in a Supply Chain Financing Program
guaranteed by the Export-Import (Ex-Im) Bank of the
United States.
Boeing is notifying several hundred qualifying U.S.
based suppliers that system testing is complete for the
new financing program, to be operated by Citibank N.A. (Citi),
allowing sign ups to proceed and payments to flow. The Ex-Im program, first offered in 2009, allows small businesses involved in exporting non-military goods to receive attractively priced working-capital financing. It is done through early payment of their accounts receivable, in this case from Boeing, in exchange for a small discount fee paid to Citi for those receivables accepted for the program. |
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The
program is part of Obama Administration's National Export
Initiative to double U.S. exports within five years. At a time
when economic recovery continues, the Bank's program helps
inject liquidity into qualifying small businesses, providing
faster access to needed cash flow. Ex-Im provides a 90 percent
guarantee of the eligible invoices while a lender, such as Citi,
bears 10 percent of the risk.
"Increasingly Boeing has called on small business to help us in
sustaining export-related jobs. The Supplier Financing Program
is a great tool to encourage this key growth area to prosper,"
said Tom Dillon, Boeing corporate finance director who led the
financing program's implementation. "Small business can truly
join larger exporters in working together to grow much needed
jobs supported by demand for American products the world wants."
"Ex-Im is
proud to have America's number one exporter, Boeing, join with
us in supporting the company's small business suppliers using
our supply chain financing product. Eligible companies will be
able to more quickly turn their accounts receivable into cash,
helping them power more sales and supporting American jobs,"
said Fred P. Hochberg, Chairman and President of Ex-Im Bank. The Boeing supplier program was authorized in September 2011 with Ex-Im Bank's approval for an initial $740 million capacity. Participating suppliers select accounts-receivable invoices they want to sell to Citi which, if accepted, are paid in a day or two instead of on the longer due dates. Capital flows to small businesses faster, and at a lower cost, as a benefit of being a supply partner to a major U.S. exporter. |