The U.S. Export-Import Bank entered an agreement with trade credit insurer Coface North America Insurance Co. to provide reinsurance.
The bank introduced its reinsurance product two years ago to help U.S. small business exporters obtain short-term export credit. Since then, participating private-sector insurers of export credit are eligible to apply for Ex-Im Bank’s reinsurance.
Participating insurers use reinsurance to originate and underwrite transactions that otherwise might be proscribed because of credit-limit caps on overseas countries or on buyers regarded as higher risk. Under terms of the agreement, Ex-Im Bank will provide reinsurance for export-credit insurance policies written by Coface to protect the accounts receivables and cash flow of American companies exporting goods and services overseas.
“With Ex-Im Bank’s trade finance insurance from Coface, American exporters now can access new markets for which insurance previously was unavailable or prohibitive in cost,” said Ex-Im Bank Chairman and President Fred P. Hochberg in a statement.
Coface North America and the global Coface Group are active in trade receivables management, business intelligence and insurance services, with operations in 66 countries and 35,000 insurance clients. Ex-Im Bank is a self-sustaining federal agency that provides financing to U.S. exporters.
“Trade credit insurance protects one of the most valuable assets that a company has – its accounts receivable,” said Michael Ferrante, chief executive officer of Coface’s North American operations. “The reinsurance program will enable more American companies to take advantage of the protection that credit insurance provides.”
In addition to protecting accounts receivable and ensuring cash flow, trade credit insurance allows companies to offer customers more favorable terms and accept larger orders. “Without it, companies are vulnerable to economic, social and political threats that inhibit their ability to succeed in international markets,” Ex-Im Bank said.
Ex-Im Bank enters agreement with Coface
