Obama urges business to back renewal of U.S. Eximbank

Reuters News
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Posted: Mar 06, 2012 8:24 PM
Obama urges business to back renewal of U.S. Eximbank

WASHINGTON (Reuters) - President Barack Obama sought to enlist the business community on Tuesday in a fight over the U.S. Export-Import Bank, whose future is threatened by Republican opposition to renewal of the 80-year old trade finance institution's charter.

"One of the most important things that Congress can do right now for companies like yours ... is to reauthorize the Export-Import Bank at the appropriate funding level," the Democrat told the Business Roundtable, a group of top U.S. chief executives.

The Eximbank, established in 1934 by President Franklin Roosevelt, provides financing to U.S. exporters to make sales that are viewed as too risky by private banks.

Its charter is generally renewed for four or five years at a time, but the bank has been operating on temporary authority since October, and has run foul of Republicans who have branded its mission as 'corporate welfare.'

Eximbank President Fred Hochberg said earlier this month that it would hit its $100 billion lending cap in a matter of weeks, potentially risking tens of billions of dollars worth of U.S. exports that need financing.

Obama reminded his audience of close to 100 corporate bosses that during the 2008 global financial crisis, the Eximbank was the only source of trade finance left, and said that it performed a vital mission at no cost to U.S. taxpayers.

"It is an indispensable resource for our exporters, especially since many of your competitors are getting aggressive finance from their governments," Obama said. "So I'm asking your help in making sure Congress does the right thing."

The press was ushered out of the room before the audience, which included Bank of America boss Brian Moynihan and JP Morgan Chase chief Jamie Dimon, got their chance to ask the president questions.

The Business Roundtable has been an outspoken critic of the Volcker Rule to restrict proprietary trading by banks, which the White House says is needed to curb the excessive risk-taking that was at the root of the financial crisis in 2008.

(Reporting By Alister Bull; Editing by Eric Walsh)