Despite questions raised in Congress, the Export-Import Bank board yesterday approved a loan of $289.3 million to an airline co-owned by Australian financier Rupert Murdoch.
The bank also approved a $173 million loan to El Al Airline of Israel, whose terms also have been questioned.
The loans are to finance aircraft being manufactured by Boeing Co. for El Al and for Murdoch's Ansett Transport Industries in Australia.
Last month The Washington Post reported that a sizable percentage of each loan was to finance amounts of credit in excess of the cost of the planes, their installed engines and other items enumerated to the bank.
The story said that the existence of the credit memos came as a surprise to some members of the board, as well as to officials at the Treasury Department.
At the same time, Sen. William Proxmire (D-Wisc.) suggested that the credit memos, financed by the bank, may be secret rebates to the airlines from Boeing. Proxmire called for the General Accounting Office to conduct an investigation, and one is under way.
Members of both houses joined Proxmire in calling for the loans to be withheld until the GAO could resolve questions about the credit memo.
Yesterday, in letters to those senators and congressman explaining why the bank went ahead with the loans before the GAO completed its probe, Acting Ex-Im Chairman Margaret W. Kahliff said "we have found no evidence . . . of any kickbacks, rebates or other activities that might be action able under the Foreign Corrupt Practices Act of 1977."
Kahliff acknowledged that the bank does finance credit memos. "It has been Ex-Im Bank's policy not to reduce the amount of the financing it makes available by the amount of the credit memorandum."
Repeating the aircraft industry contention that the memos were necessary to match foreign competitors, she said the bank "does not interfere with the pricing mechanism of U.S. suppliers."
But Kahliff said: "As a policy matter, the question of credit memorandums will be reviewed."
Sen. John Heinz (R-Pa.), chairman of a subcommittee on international fiance, agreed in a letter to Kahliff that to wait until the GAO completed its probe might "unduly delay" the loans. But he added: "I have questions, particularly about the Ansett transaction," and he said he would ask them of Ex-Im bank Chairman-Designate William H. Draper 3rd.
Proxmire did not answer Kahliff's letter, but said in a statement that the Ansett loan should not have been approved until Draper's confirmation hearings and until the GAO completes its investigation.