Take advantage of your bank in

pursuit of export happiness

2013 Winter Legislative Conference

February 11, 2013

Need money, what for? To fulfill export purchase order(s) - Project

based

To find a bridge financing between the trade cycle of A/R, inventory and A/P – asset based

To buy capital (fixed) assets – long-term investment

To finance market development and other reasonable general working capital

Start-up costs (including R&D)

Interview your banker Comprehension of international trade

Bank’s international infrastructure

Does your bank look beyond the figures

Unspoken rules

Organized in 1976 as First Women’s Bank of Los Angeles

Full service commercial bank that is known for customizing solution for clients

Specialize in EXPORT FINANCING and COMMERCIAL REAL ESTATE Export: EXIM WCGP, Insured A/R Fin.; SBA EWCP, Export

Express, ITL Domestic: SBA CAPLine, 7A, Business Equity CRE: SBA 504, Conventional lending as low as 3.98% for OCP

Nine branches/LPO throughout the West Coast

GBC International Bank was Named as Western Region Lender of the Year by EXIM Bank

EXIM Bank and SBA EXIM Bank Working Capital Guarantee Program

EXIM Bank Medium/Long-Term Financing Program

Insured A/R Line of Credit (with Enhanced Assignment)

SBA Export Working Capital Program

SBA ExportExpress Program

SBA International Trade Loan

Benefit of government guaranteed loan programs

-Fulfill export sales orders

-Turn export-related inventory and accounts receivable into cash -Cost reduction

-Finance Bid and/or Performance Bonds

-Increase advance rate

-Level the playing field

-Due diligence from the bank may be the seal of approval your investor(s) needs to see

Export Working Capital Program

Transaction Specific To finance one-time identifiable transaction

Transaction Specific Revolving To finance multiple identifiable transactions

Non-Transaction Specific Revolving To finance general export-related A/R and export-

related inventory

Case Study (Transaction Specific) A Mexican utility company placed order to install

inlet air cooling system on gas turbine for $4 million

Cost to the US exporter is $2 million for the transaction, which includes $1.5 million raw material, $400K manufacturing costs $80K engineering & $20K installation. Production time is 8 month.

Due to competition, 10% down payment. You get a 60-day Term L/C for remaining 90% of payment.

Transaction requires 10% Standby L/C as performance bond

GBC comes to the rescue Solution:L/C service Advising and negotiation of $3.6 million commercial L/C Issuance of $300K standby L/C

Export Financing $3,240,000 12-month EXIM LOC for both pre-shipment

financing on the 75% of cost and post-shipment financing on 90% of L/C-proceed

$300,000 12-month EXIM LOC to finance the issuance of

performance bond. Bank will require at least 25% of face value of the standby L/C in collateral (10% with EXIM approval)

Case Study (Transaction Specific Revolving)

A scrap metal export trader has a buyer in China that consistently orders once a month for $500K supported by sight L/C issued by Bank of China

COGS is $440K/order. Shipment is once a month. Exporter buys the scrap metal from scrap yard with $40K due at the time of placing order, the remaining $400K is paid prior to loading

This exporter is also looking to buy a metal processing machine valued at $1 million, but only has $200K

What if you don’t have $440K

Solution:L/C service Advising and negotiation of $500,000 commercial L/C on

monthly basis

Export Financing $330,000 12-month SBA EWCP for pre-shipment financing

on the 75% of cost Bank will disburse $30K to pay the scrap yard at the time of

placing order. Then advance another $300K prior to loading the container. Exporter just need to come up with $110K prior to shipment

Bank structures an SBA International Trade Loan for $800K

Case Study (Non-Transaction Specific Revolving)

VOS Inc is a manufacturer of cosmetic products and exports 100% of its products to 20 foreign distributors, orders are placed each month, $10K per order (Total $200K)

The company consistently maintains $450K in inventory and $200K in A/R with 30-day term. Distributors demand 60-day term or will switch to another supplier, but will buy more with 60-day A/R term.

VOS estimates A/R will increase to $500K with 60-day term, and inventory level will also raise to $550K. But VOS is cash restrained from meeting the demand of distributors.

Don’t panic, get financedSolution:

Export Financing As a 100% exporter, borrower gets the maximized

borrowing capacity on it’s assets (eligible A/R and eligible inventory)

At maximum advance rate of 90% on eligible A/R (90% of

$500K = $450K) and 75% on eligible inventory (75% of $550K = $412.5K), Bank can lend up to the combined borrowing base of $862.5K.

Monthly borrowing base will fluctuate. GBC may suggest a $1 million EXIM LOC, providing some cushion should additional loan advance is necessary.

Contact Information (WWW.GBCIB.COM)

Kelly Chiou, AVP & Commercial Banking Officer(206) 219-0236 kchiou@gbcib.com

Douang Nonthaveth, AVP & Commercial Banking Officer(206) 219-0263 dnonthaveth@gbcib.com)

Annie Pan, EVP & Chief Marketing Officer Edward Tang, VP & Trade Finance Officer(626) 243-1180 apan@gbcib.com (626) 243-1183 etang@gbcib.com