U.S. Ex-Im Bank's charter to expire after midnight Tuesday

The charter of the U.S. Export- Import Bank will expire after midnight Tuesday for the first time in history due to Congress inaction, but supporters are hopeful the federal credit institution will eventually be reauthorized.

"Despite the strong bipartisan support for reauthorization, the Republican-controlled Congress has gone into recess without holding a meaningful vote on Ex-Im, allowing Ex-Im to lapse on July 1 for the first time in history," the White House said Tuesday in a fact sheet, noting that the bank will not be able to offer new financing starting Wednesday.

The Ex-Im Bank, which provides finance for the export of U.S. goods and services, has long enjoyed bipartisan support and been reauthorized 16 different times over its 81-year history. But in recent years, it has become a target of conservative lawmakers and activists who label it as "crony capitalism" and want the bank to expire.

"This is a small step toward renewing a competitive free-market economy and arresting the rise of the progressive welfare state and the cronyism connected to it," House Financial Service Committee Chairman Jeb Hensarling, a tea party conservative and a leading opponent of the bank, said of the upcoming expiration of the bank's charter last week.

"Ex-Im is a part of yesterday's economy. Our focus needs to be on tomorrow's economy and on reforms that will give every American greater opportunities to succeed," Hensarling said.

But supporters, including all the major U.S. business groups, argue that the bank plays a critical role in helping level the playing field for U.S. exporters.

"Ex-Im is one of the most important tools at the disposal of U. S. companies to level the playing field for trade finance as they seek to increase exports and create jobs at home," Bruce Josten, executive vice president for government affairs at the U.S. Chamber of Commerce said Tuesday in a statement.

"Given strong bipartisan support in both the House and Senate, we urge Congress to find an expeditious path forward on Ex-Im when members return in July," Josten said.

The Senate will attach a reauthorization amendment of the bank to an infrastructure spending bill in July, according to the Hill, a political news website. But it remains unclear whether the conservative Republicans will block such amendment.

Fred Hochberg, Chief Executive Officer of the Ex-Im Bank, was hopeful that the bank's charter will eventually be reauthorized. " Frankly, we're going to be reauthorized; the question will be precisely when and what form," Hochberg said in an interview with Politico.

Hochberg said the bank's authority to make new loans will expire after June 30, but it will have no impact on its current obligations. "There's a large function as bank that does not go away we've got an over 110 billion U.S. dollars loan portfolio that's got to be managed and serviced to make sure we get repaid."

Last year, the bank authorized 20 billion U.S. dollars worth of transactions which supported 27.5 billion dollars of U.S. exports and 164,000 U.S. jobs. Endite