Lisle, Ill.-based Navistar is a manufacturer and marketer of medium and heavy trucks and mid-range diesel engines.
“Ex-Im Bank’s supply chain financing benefits Navistar’s small business suppliers by ensuring that they are paid more quickly,” said Fred P. Hochberg, Ex-Im Bank’s chairman and president, in a statement on Friday. “This product improves supplier liquidity and helps create and sustain American jobs in the process.”
“The Ex-Im Bank is an important tool that provides support for small businesses and exporters to capture business in new emerging markets and create American jobs, while also creating a level playing field for U.S. companies competing in the global marketplace,” said A.J. Cederoth, Navistar’s executive vice president and chief financial officer. “Support from Ex-Im Bank helps our small-business suppliers free-up much needed capital in support of Navistar’s global growth efforts.” Ex-Im Bank’s supply chain finance guarantee program allows Navistar’s suppliers to receive early payment of their accounts receivable that are due from the company in exchange for a small discount fee that is paid to the lender. Ex-Im bank provides a 90 percent guarantee on the invoices while the lender bears 10 percent of the risk.
Under the program, approved lenders must have an existing supply chain finance program. Ex-Im Bank has set a target that at least 50 percent of the credit, by the end of the 12-month term, is extended to suppliers that meet the definition of a small business as defined by the Small Business Administration. The end products must be exportable and must meet Ex-Im Bank’s requirements for U.S. content.
Navistar’s guaranteed lenders are The Bank of Nova Scotia, located in Toronto, Canada, and the Royal Bank of Scotland, located in Stamford, Conn.
