Salt Lake-based Zions Bank signed an agreement Wednesday with the Overseas Private Investment Corp. and Interlink Capital Strategies to help its small-business clients invest in emerging markets.
As part of the agreement, announced at Zions Bank's International Trade and Business Conference at the Little America Hotel, Interlink will prepare Zions customers' applications for OPIC financing — a process some small businesses previously found daunting and cumbersome.
At this time, OPIC's agreement with Interlink and Zions is the only one of its kind in the western United States.
OPIC, a federal agency established in 1971, helps American businesses invest overseas through direct loans for projects (new investments, expansions and some acquisitions), loan guarantees and political risk insurance (including terrorism insurance). The agency has $20 billion in investments in 150 countries.
One of OPIC's objectives, according to James Polan, OPIC Small and Medium Enterprise Finance Department vice president, is to double or even triple its small-business program going forward. That includes Utah.
Polan said OPIC has committed $46 million in financing and insurance products to Utah firms, which are expected to generate $56 million in U.S. exports and support 227 U.S. jobs. Ten firms are seeking support for projects that represent $6 million in U.S. investment.
Despite this, firms historically have had to endure a bureaucratic, complicated process.
"In some respects we are a private entity in the way it feels to work with us," he said. "However, we are in Washington, D.C., and we are owned by the government, so there's always that level of frustration. This is one of the reasons we set this program up."
The Zions agreement means that "what comes to our office is a nice packaged project, which we can expedite and, in relatively short order, you can get an answer," Polan said. "We are quite confident that we can increase, exponentially, Utah's — and the other markets where Zions does business — investment in emerging markets overseas."
Qualifying businesses have annual revenues under $250 million, or (if there are no revenues yet) a net worth of $67 million. The 150 "emerging markets" identified by OPIC do not include countries in Western Europe or Canada.
"We are not necessarily looking for the company with the deepest pockets," Polan said. "More than that, we're looking for a good management team and a good idea."
Security issues aside, globalization will continue and should, Polan said. Utah should be in the thick of it, according to Utah Gov. Olene Walker.
"No state can be an island at the current time," Walker said Wednesday. "We've got to realize that the future is based not just on our ability to extend to other states or to other countries in our hemisphere, but we have worldwide business opportunities if we but take advantage of them."
The Zions-OPIC agreement "will revolutionize the way foreign exchange is handled," said Zions president and chief executive officer Scott Anderson. It will allow Utah small businesses to seize opportunities and new adventures.
"We are pleased at Zions to see the Utah economy continue its steady emergence from recession," Anderson said. "We expect the stronger growth pace we've experienced in the last couple of months to pick up speed as 2004 progresses, and we see on the charts a strong performance in 2005 as well.
"But Utah is a subcomponent of two larger economies — the U.S. economy and the global economy. Utah will continue to benefit from strong performances in these larger entities if we are prepared to take advantage of the opportunities before us."
E-mail: jnii@desnews.com