A few months ago, Congress decided not to renew the 81-year-old Export-Import Bank.
Our local banker had told us not to worry, because our Congress would never be so shortsighted.
But it happened. The Ex-Im Bank was closed for new business at the end of June, forcing our payoff of a $1.1 million loan balance before the end of December and eliminating our ability to borrow for next year’s export projects.
Our company, TDI-Brooks International Inc., is one of many small companies supported by the Ex-Im Bank. We design, test and operate highly sophisticated seabed tools to help petroleum producers with offshore energy exploration.
The Export-Import Bank has been an essential supporter of our international growth — and even our existence — since 2007. Our loan supported more than $15 million in exports last year alone.
Thanks to that support, we were able to employ more than 100 people. But not anymore.
No commercial bank will issue a revolving line of credit on export trade amounts owed us even by world-class oil companies.
At the same time, our government told banks in Texas to mark all oil and gas loans as “distressed” due to the market downturn, so a 20-year-old company like ours, with a perfect credit record, cannot borrow — simply because we are in the oil and gas industry at the wrong time.
We have laid off several of our staff so that we could service our debt.
Founded in 1934, Ex-Im provided loans, working-capital guarantees and export-credit insurance to help U.S. businesses finance overseas sales and services.
Critics falsely say it took business away from private lenders.
In reality, the Ex-Im Bank worked for years with our local bank, enabling our bank to loan us money. Now without Ex-Im support, several local banks have said no.
About 60 national export-credit agencies around the world work aggressively to take business away from the U.S.
Many nations have larger direct export incentives than does our Ex-Im Bank.
Our competitors are all large foreign companies. For us, the international offshore playing field is not level without Ex-Im.
The bank’s loan-default rate runs at around 0.2 percent a quarter, which is better than many commercial banks.
Thanks to these low default rates and the fees that it charges, the bank has been able to turn profits year after year that go right back to the American taxpayer.
Over the past 20 years, the bank has returned almost $7 billion to the U.S. Treasury. In 2014 alone, it returned $647.7 million.
It makes no sense that the government would eliminate it.
We have done nothing except advance the state of our science, help find oil and provide opportunity for many local families to enjoy their lives.
Members in both houses have introduced legislation to reauthorize the Ex-Im Bank. It’s time for Congress to bring it back before the new year.
James Brooks and Bernie Bernard are owners of TDI-Brooks International Inc. in College Station.