The financial arm of the American federal government, the Overseas Private Investment Corporation (OPIC), is considering doing business in Israel.

Its interest in operating locally is noteworthy, especially in light of widespread fears that the second war in Lebanon would frighten foreign banks, leading them to scale back activity in Israel.

OPIC, one of the largest federal financing bodies, assists American companies with overseas operations and invests in emerging markets in keeping with American foreign policy.

It has so far extended one loan to Israel - $250 million for an underwater gas pipeline about five years ago.

Now OPIC is considering another Israeli venture, in a totally different field: bonds backed by mortgage portfolios. In this type of transaction, mortgage banks sell their loan portfolios.

OPIC is considering purchasing mortgage portfolios from Israeli banks and then reselling the portfolios, apparently to American companies. Thanks to OPIC's involvement, the mortgage portfolios would receive high ratings and be able to fetch higher prices than the Israeli banks could obtain.

OPIC's involvement would also have another advantage: It generally purchases a bank's entire portfolio. Other buyers usually purchase only the lowest-risk loans, leaving the higher-risk loans with the bank. The bank must then retain capital to cover them instead of being able to invest its capital.

The European Investment Bank (EIB) has also recently expressed interest in Israel: It is investigating the possibility of extending low-interest financing to Israeli BOT (Build, Operate, Transfer) projects. In the BOT system, a company wins a tender to build an infrastructure project and operate it for a given period, usually 25 to 30 years; it then transfers the project to the state when this period ends.