Industrial Revenue Bonds

Industrial Revenue Bonds (IRBs) offer a low-cost financing tool for manufacturers whose business plans call for growth and expansion. IRBs can be used to purchase new manufacturing equipment, build a new facility, expand an existing one, or to rehab a newly acquired facility or company.
An IRB is a tax-exempt loan issued through a state or local government to private manufacturing companies. Because of the interest on the bonds is exempt from federal taxes – and in some cases state taxes – lenders can offer rates lower than traditional debt, making them cost effective for the borrower.


  • Companies must use the facility/equipment to manufacture or process real, tangible products
  • Tax-exempt issues of less than $2 million do not qualify; they are generally not cost-effective


  • Lower interest rate than traditional debt (due to tax exemption)
  • Fixed or variable-rate financing
  • The Bank is not acting as a municipal advisor or financial advisor, and has no fiduciary duty (or duty of fair dealing), pursuant to Section 15B of the Securities Exchange Act of 1934.