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WASHINGTON, D.C. -The Export-Import Bank of the United States (Ex-Im Bank) today extended its offer to reduce its exposure fee by one-third on asset-backed financings of new U.S.-manufactured large commercial aircraft for international buyers in countries that ratify and implement the Cape Town Treaty and the related aircraft equipment protocol. The extension will cover aircraft financing approvals issued from October 1, 2006, through March 31, 2007. Ex-Im Bank's exposure fee is the risk premium that the Bank charges for its export financing.

In addition, Ex-Im Bank's board of directors applauded the progress that Ex-Im Bank and its counterpart export credit agencies (ECAs) in Europe have made to date in developing a common approach to offering improved financing terms to airlines based in countries that ratify and implement the Cape Town Treaty (including specified qualifying declarations under the treaty). Ex-Im Bank's board also agreed to consider transitioning to such a common approach during the period of the extension if agreement can be reached with the European ECAs on offering improved financing terms from those that are currently available under existing export credit guidelines.

The Cape Town Treaty and the related aircraft equipment protocol is an international treaty to facilitate the cross-border financing and leasing of aircraft, helicopters and aircraft engines. The aircraft equipment protocol became effective earlier in the year, on March 1, 2006, which enabled the beginning of a registry of international financial interests in aircraft, helicopters and aircraft engines in those countries that have ratified/acceded to and implemented the Cape Town Treaty.

Ex-Im Bank believes firmly that the Cape Town Treaty and the international registry result in greater predictability for aircraft financiers by significantly reducing the legal risks associated with cross-border, asset backed aircraft financings and leases, said Ex-Im Bank Chairman and President James H. Lambright. Although the Cape Town Treaty has already entered into force, we will continue to encourage more countries to adopt and implement this treaty. We look forward to working with our counterpart export credit agencies to promote the treaty's widespread adoption.

Ex-Im Bank Vice President of Transportation Robert Morin said, The reduced legal risk of transactions that are subject to the protections of the Cape Town Treaty justifies Ex-Im Bank's extension of its offer to reduce its exposure fee and offer other improved terms for aircraft and spare engine financings for airlines based in countries that ratify and implement the treaty. The Cape Town Treaty is intended to expand the sources of financing, increase the amount of available financing and lower the cost of financing available to airlines. In turn, this lower cost of financing will enable airlines to upgrade their fleets through new aircraft and related equipment purchases, thereby supporting jobs in the aerospace industry.

Since 2003, Ex-Im Bank has offered a one-third reduction of its exposure fee on asset-backed financings of new U.S.-manufactured large commercial aircraft for buyers in countries that ratify and implement the Cape Town Treaty and the related aircraft equipment protocol (including specified qualifying declarations under the Cape Town Treaty).

Ex-Im Bank's current offer to reduce its exposure fee enables eligible foreign buyers to receive an Ex-Im Bank exposure fee of as low as two percent, a one-third reduction of the current minimum three percent exposure fee on asset-backed financings of new large commercial aircraft. More favorable financing terms also apply to asset-backed financings of spare engines to such buyers.

Ex-Im Bank also extends preferential financing terms to leasing companies but only if the aircraft leasing company and the airline lessee under the initial operating lease are both based in a Cape Town Treaty country and make the appropriate declarations under the treaty and the related aircraft equipment protocol.

To date, 11 countries have ratified/acceded to and implemented the treaty, including the United States. Airlines have benefited from Ex-Im Bank's more favorable financing terms in five of the countries that have implemented the treaty: Ethiopia, Oman, Pakistan, Panama and Senegal.

The Cape Town Treaty (formally known as the Convention on International Interests in Mobile Equipment) was concluded at an international diplomatic conference in Cape Town, South Africa, in November 2001. The treaty establishes a commercially oriented, comprehensive international legal framework to protect security and leasing interests in aircraft equipment.

More information on the Cape Town Treaty may be found on the Web site of UNIDROIT, an independent intergovernmental organization that studies the needs and methods for modernizing, harmonizing and coordinating private and commercial law as between states and groups of states. UNIDROIT acts as the depositary under the Cape Town Treaty. See http://www.unidroit.org/english/conventions/mobile-equipment/main.htm

Ex-Im Bank, the official export credit agency of the United States, is in its 72nd year of helping finance the sale of U.S. exports, primarily to emerging markets throughout the world, by providing loan guarantees, export credit insurance and direct loans. For more information, visit www.exim.gov.