ICC Banking Commission 2015 Events

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6 December 2018

In addition to its bi-annual summit gathering +300 international delegates every six months, the ICC Banking Commission organizes regular seminars and conferences around the world, in partnerships with ICC National Committees and other sponsors.

The ICC Banking Commission meetings are the only events of their kind gathering over 600+ banking executives and government officials from more than 65 countries to rethink the future of trade finance.

ICC Banking Commission 2015 Events

ICC Banking Commission Annual Meeting 20 – 23 April, 2015 Singapore
Supply Chain Finance Conference – 4th Edition TBC (Fall), 2015 Paris, France
ICC Banking Commission Technical Meeting TBC (Fall), 2015 Paris, France

ICC Banking Commission Annual Meeting 20 – 23 April, 2015 Singapore

The Annual ICC Banking Commission Meeting will take place at Raffles City Convention Center in Singapore between 20-23.April 2015.

The Banking Commission of the International Chamber of Commerce (ICC), in collaboration with the Association of Banks in Singapore (ABS), is pleased to invite you to the ICC Banking Commission – Annual Meeting to be held at the Raffles Convention Center in Singapore on 20-23 April 2015.

ICC Banking Commission Technical Meeting TBC November 16 – 18, 2015 Paris, France

About the ICC Banking Commission

With +550 members in 85 countries, the ICC Banking Commission has rightly gained a reputation as the most authoritative voice in the field of trade finance.

Active in shaping policy and regulatory issues, the ICC Banking Commission is also known for producing universally accepted rules and guidelines for international banking practice, notably letters of credit, demand guarantees and bank-to- bank reimbursement.

ICC rules on documentary credits, UCP 600, are the most successful privately drafted rules for trade ever developed and are estimated to be the basis of trade transactions involving more than one trillion dollars a year.

SACE Guarantees €400 Million for STAR Project

By

Ozgur Eker (CDCS)

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4 December 2018

0

SACE has joined in a mission of Prime Minister Matteo Renzi to Turkey, promoted by his office and the Ministry for Economic Development, to strength the potential for trade with this key market for Italy.

During the mission, SACE is announcing finalization of a guarantee on a € 400 million line of credit earmarked to finance contracts awarded to 50 Italian firms, including SAIPEM, as part of Project STAR (Socar Turkey Aegean Refinery).

The project, worth a total of 4.4 billion dollars, concerns the construction in project finance of a greenfield refinery at Aliaga near Izmir.

The facility will be of strategic importance for the country because, with its output of 200,000 barrels/day, it will reduce the country’s dependence on imported refined products.

SACE is making a € 2.1 billion line of guarantees available to Italian businesses operating or intending to operate in Turkey that will enable them to:

access loans guaranteed by SACE to support their development plans in the country (investments in distribution networks, industrial joint ventures, acquisitions of local companies, advertising expenses, retail outlets, machinery purchases, etc.)
sell goods and services by offering Turkish customers extended payment terms of up to five years, through the use of letters of credit, and ensuring them against default risk
collect payments from Turkish customers in advance, insuring them against insolvency risk.

SACE already has pre-commitments with the principal banking groups in the country: Turkiye Is Bankasi AS, Turkiye Garanti Bankasi AS, Turkiye Cumhuriyeti Ziraat Bankasi, Akbank TAS, Yapi ve Kredi Bankasi, Turkiye Halk Bankasi TAO, Turkiye Vakiflar Bankasi TAO, Denizbank AS.

One of the emerging favored markets for Italian exports with over € 13 billion in goods sold in 2013, Turkey has the third largest exposure in the SACE portfolio, with € 1.3 billion in transactions insured and € 1.5 billion in new projects currently under consideration, focused primarily on construction and infrastructure, steel and industrial equipment.

Turkey is one of the emerging countries SACE has indicated as high-potential markets, with sustainable risk profiles, to which Italian exporters should strengthen their positioning in the medium-long term to capture additional potential of € 38.5 billion in the next two years*, € 4 billion of it provided by Turkey.

A glance at SACE operations

In Turkey, where it has a representation office in Istanbul, SACE is intensely active alongside companies in various areas of industrial technology, with interesting activity on the part of SMEs.

The transactions currently on the table include project finance in both the private and public sectors, loans to banks and leasing companies, and a growing number of export credit transactions in favor of SMEs.

The supplier credit transactions, dedicated primarily to smaller companies, have been the most numerous in 2014, a year in which SACE has approved € 340 million in new transactions.

U.S. Trade Finance Concentrated With Top 5 Banks

By

Ozgur Eker (CDCS)

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4 December 2018

0

Published on-19.November.2014- Approximately 35% of large U.S. companies do business with Bank of America Merrill Lynch, Citi and J.P. Morgan.

The top five is rounded out by HSBC and Wells Fargo, both of which have achieved market penetration levels of 23–24%.

These banks are the 2014 Greenwich Share Leaders in U.S. Large Corporate Trade Finance.

The 2014 Greenwich Quality Leaders are Deutsche Bank, J.P. Morgan and RBS.

Despite this high level of concentration, companies have seen some significant shifts in the competitive landscape of providers over the past several years. In domestic trade finance, up-and-coming Wells Fargo capitalized on an opportunity to gain ground.

“Many of the banks are weighing the thin margins for trade finance against the increasing capital requirements from Basel III,” says Greenwich Associates consultant Andrew Grant. “We are seeing some banks actively pulling back in certain segments while others aggressively step in to fill the void.”

Throughout this period, one trend remains consistent: The international needs of large U.S. companies are expanding.

With companies eying Western Europe, Asia and Latin America, banks with broad international networks have a clear advantage, and providers including HSBC have capitalized on this demand with strong gains in market penetration.

Consultants Don Raftery and Andrew Grant specialize in trade finance in the United States. Please read full report from this link.

About Greenwich Associates

Greenwich Associates is the leading provider of global market intelligence and advisory services to the financial services industry. Our clients include nearly all of the world’s leading investment banks, commercial banks and asset managers.

Greenwich Associates began in 1972 with the vision of Charley Ellis and a small team of 10 Members in Connecticut (US). His big idea: Create a superior professional strategic financial consulting firm, hire the very best people and deliver insightful, unbiased, timely and above all actionable advice to help clients improve business performance.

Knowing that the best advice requires the best information, we have developed our own independent, in-depth market research practice. This year alone, we will interview more than 50,000 highly regarded financial services executives in more than 70 countries.

Today, Greenwich Associates serves:

Financial services providers
Financial services buyers
Market information users

Our client base includes more than 250 leading banks and fund manager firms, plus the more than 50,000 corporations and institutions who, as participants in our research, are members of the Greenwich Exchange.

GTR Reveals Leaders in Trade 2014

By

Ozgur Eker (CDCS)

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4 December 2018

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Published on 02.December.2014 – Two months ago GTR called all companies that read the magazine and attend GTR events to vote in GTR’s annual Leaders in Trade awards.

The voters have been asked to tell which financial institutions are the best internationally.

Best Global Trade Finance Bank:

First place: HSBC
Runner-up: Citi

Best Global Export Finance Bank:

First place: Société Générale
Runner-up: HSBC

Best Global Commodity Finance Bank:

First place: BNP Paribas
Runner-up: ABN Amro

Best Global Structured Commodity Finance Bank:

First place: ING
Runner-up: Deutsche Bank

Best Trade Finance Bank in Latin America:

First place: Santander
Runner-up: BBVA

Best Trade Finance Bank in Asia:

First place: Standard Chartered
Runner-up: Bank of America Merrill Lynch

Best Trade Finance Bank in CEE:

First place: Commerzbank
Runner-up: Raiffeisen Bank

Best Trade Finance Bank in CIS:

First place: Sberbank

Best trade finance bank in Australia and Pacific:

First place: Westpac
Runner-up: ANZ

Best Trade Finance Bank in the M.East & N.Africa:

First place: HSBC
Runner-up: FGB

Best Trade Finance Bank in Sub-Saharan Africa:

First place: Standard Bank
Runner-up: Barclays Africa

Best Trade Finance Bank in the Nordic Region:

First place: SEB
Runner-up: Nordea

Best Trade Finance Bank in North America:

First place: JP Morgan
Runner-up: Bank of America Merrill Lynch

Best Trade Finance Bank in Western Europe:

First place: Deutsche Bank
Runner-up: Crédit Agricole

Best Trade Finance Bank in the UK:

First place: RBS
Runner-up: Barclays

Best Islamic Trade Finance Bank:

First place: Maybank
Runner-up: ITFC

Best Development Bank in Trade:

First place: Asian Development Bank
Runner-up: African Development Bank

Best Alternative Trade Finance Provider:

First place: Falcon Group
Runner-up: Trade Finance Partners

Best Export Credit Agency:

First place: UKEF
Runner-up: EDC

Best supply chain finance bank:

First place: Citi
Runner-up: JP Morgan

Best Forfaiting House*:

First place: LFC
Runner-up: UniCredit

Best Factoring House*:

First place: GE Capital
Runner-up: Bibby Financial Services

Best Trade Outsourcing Bank*:

First place: BNY Mellon
Runner-up: Wells Fargo

Best Trade Finance Software Provider*:

First place: China Systems
Runner-up: Misys

Best Bank for Documentary Processing*:

First place: Commerzbank
Runner-up: RBS

Best Trade Credit and Political Risk Insurance Broker*:

First place: BPL Global
Runner-up: Arthur J Gallagher

UK Export Finance Voted as the Best Export Credit Agency

By

Ozgur Eker (CDCS)

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4 December 2018

0

UK Export Finance (UKEF) – a government department and the UK’s official export credit agency (ECA) – is in a celebratory mood at the latest news from trade finance magazine and events organizer Global Trade Review (GTR).

Having been asked which financial institutions are the best internationally, the 10,000 senior management readers of GTR, have voted UKEF as the best ECA.

With companies such as Barclays, Citi, Deutsche Bank, HSBC and RBS all winning awards in the trade finance and global trade finance sectors of the GTR Leaders in Trade 2014, the award puts UKEF in good company.

It also follows UKEF’s delivery of innovations that include the launch of both the Direct Lending Facility, which supported its first loan in early October, and the Export Refinancing Facility, as well as the extension of guarantees for offshore Renminbi-denominated loans – a first for an ECA.

At the same time, UKEF has strengthened its short term product offering, supporting contracts worth over £1 billion already in 2014, with over 200 companies and contracts worth over £2 billion supported since their launch.

Added to the announcement that UKEF will guarantee a sukuk bond for the first time early next year and plans to simplify the application and approval process to help small and medium sized enterprises (SMEs), it has been a highly productive year for UKEF.

Commenting on the award, David Godfrey, Chief Executive of UKEF said:

Over the past couple of years we have successfully introduced and embedded our regional team of export finance advisers, provided Airbus with credible and competitive capital markets funding solutions, and have secured eligibility for UKEF paper to be discounted at the Bank of England’s Discount Window – helping banks with their liquidity ratios.

Global Trade Review is a respected publication, whose trade conferences and seminars are among the best attended in the calendar. That it is their readers – banks, intermediaries, other ECAs and exporters – who have voted for us, is especially pleasing. This is a vote of confidence for the whole UKEF team and we are delighted.

About UKEF

UKEF is the UK’s export credit agency. UKEF helps UK exporters by providing insurance to exporters and guarantees to banks to share the risks of providing export finance. In addition, UKEF can make loans to overseas buyers of goods and services from the UK. UK Export Finance is the operating name of the Export Credits Guarantee Department (ECGD).

UKEF:

insures UK exporters against non-payment by their overseas buyers
helps overseas buyers to purchase goods and services from UK exporters by
guaranteeing or funding bank loans to finance the purchases
shares credit risks with banks to help exporters raise tender and contract bonds, in
accessing pre- and post-shipment working capital finance and in securing confirmations of letters of credit
insures UK investors in overseas markets against political risks

BCG and SWIFT Published Global Payments Report 2014

By

Ozgur Eker (CDCS)

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4 December 2018

0

The Boston Consulting Group (BCG) published in cooperation with Swift a new report on consumer payments-exploring key trends in Europe, North America, and rapidly developing economies.

Report also examines the wholesale transaction-banking business, with a focus on the implications of regulatory challenges.

The report discusses the steps that all types of payments players must take in order to succeed.

Global Payments Report 2014:

Published on 28 Nov 2014 – The aim of the report is to provide payments and transaction-banking institutions with a comprehensive overview of major business drivers shaping the industry.

It also provides the reader with recommendations on which specific actions should be taken by various types of players in order to achieve or maintain market-leading positions.

In today’s competitive environment, financial institutions must differentiate themselves and bring value to continue to grow.

The report in numbers:

In 2013, payments businesses generated $425 billion in transaction revenues, $336 billion in account-related revenues, and $248 billion in net interest income and penalty fees related to credit cards.
Banks handled $410 trillion in non-cash transactions in 2013, more than five times the amount of global GDP.
The value of non-cash transactions will reach an estimated $780 trillion by 2023, a compound annual growth rate of 7 percent. Payments revenues will reach an estimated $2.1 trillion, a CAGR of 8 percent

Stefan Dab, Senior Partner and Managing Director, BCG, says: “The growth in payments and transaction banking, moreover, is driving stiff competition among not only traditional players but new entrants as well. Consequently, financial institutions must differentiate themselves, refine their strategies, and raise their execution skills if they want to remain competitive.”

Wim Raymaekers, Head of Banking and Treasury Markets, SWIFT, adds: “We are pleased to work with BCG to provide our customers with insights as to how the payments transaction landscape and revenues will evolve over the next 10 years. Banks can use these insights as input to their payment business strategy and execution, since growth will differ widely by region.”

Here is the interactive version of the Global Payments Report 2014.

ICC Uniform Rules for Forfaiting (URF 800)

By

Ozgur Eker (CDCS)

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3 December 2018

0

Forfaiting means the sale by the seller and the purchase by the buyer of the payment claim on a without recourse basis.

In other words, forfaiting is discounting of trade‐related receivables secured with trade finance instruments such as bills of exchange, promissionary notes or deferred payment letters of credit.

In the U.S., forfaiting is known as “structured trade finance”, and every year more than USD 300 billion of world trade takes place using forfaiting.

ICC Uniform Rules for Forfaiting which is called URF 800 is the first set of rules which governs both international and domestic forfaiting transactions.

These rules went into effect on January 1, 2013.

URF 800 is created by the experts from ICC (International Chamber of Commerce) and ITFA (International Trade and Forfaiting Association) with a spread of expertise – marketing, operational and legal – and geographical location.

What are the Headings of URF 800?

You can find table of contents of Uniform Rules for Forfaiting below. Uniform Rules for Forfaiting consists of total 14 articles and 4 annexes.

Table of Contents of URF 800 Rules

FOREWORDS
INTRODUCTION
Article 1 Application of URF
Article 2 Definitions
Article 3 Interpretations
Article 4 Without recourse
Article 5 Forfaiting agreements in the primary market
Article 6 Conditions in the primary market
Article 7 Satisfactory documents in the primary market
Article 8 Forfaiting confirmations in the secondary market
Article 9 Conditions in the secondary market
Article 10 Satisfactory documents in the secondary market
Article 11 Payment
Article 12 Payment under reserve
Article 13 Liabilities of the parties
Article 14 Notices

ANNEXES
Annex 1 Master Forfaiting Agreement
Annex 2 Forfaiting Agreement
Annex 3 Forfaiting Agreement in SWIFT format
Annex 4 Forfaiting Confirmation

How URF 800 Can be Applied to Forfaiting Transactions ?

All ICC rules which are related to international trade require express incorporation into the agreements.

For example, the UCP 600 rules will apply to the letters of credit when the text of the credit expressly indicates that it is subject to the UCP 600.

The Uniform Rules for Forfaiting (URF 800) are no exception.

URF 800 rules apply to a forfaiting transaction when the parties expressly indicate that their agreement is subject to these rules.

They are binding on all parties thereto except so far as modified or excluded by agreement.

Some Important Benefits of ICC Forfaiting Rules:

According to Silja Calac, who was the chair of the task force that gathered from both ICC and ITFA to create URF rules, what the UCP (Uniform Customs & Practice for Documentary Credits, ICC publication 600) has achieved for the management of risk in international trade, the URF (ICC publication 800) will hopefully bring to the funded side of trade – not only international trade, but also even domestic receivables financing.

She also believes that “the URF will be highly beneficial for exporters intending to sell down their claims related to their trade finance transactions.

Referring to clear rules in the documentation will save corporates high legal costs, improve certainty and enhance business because each party will know exactly what to expect.”

Where to Buy the URF 800 Book?

You can buy ICC Uniform Rules for Forfaiting (URF 800) Including Model Agreements ICC Publication No. 800 , 2013 Edition from this link:

ICC Uniform Rules for Forfaiting URF 800 English Version Including Model Agreements
By ICC Banking Commission & International Forfaiting Association
ICC Publication No. 800E, 2012 Edition

How Forfaiting Works?

By

Ozgur Eker (CDCS)

-

3 December 2018

0

Forfaiting is an international supply chain financing methods.

Forfaiting means the discount of future payment obligations on a without recourse basis.

In other words, forfaiting is discounting of trade‐related receivables secured with trade finance instruments such as bills of exchange, promissionary notes or deferred payment letter of credit.

In the U.S., forfaiting is known as “structured trade finance”, and every year more than USD 300 billion of world trade takes place using forfaiting.

What are the Main Characteristics of Forfaiting?

Forfaiting is an international trade finance tool.

It helps exporters or international manufacturing companies to reach cash flow by selling their debts, which are mostly supported by a bank guarantee, or trade‐related receivables secured with trade finance instruments such as bills of exchange, promissionary notes or deferred payment letter of credit proceeds with a discounted price to the forfaiting companies.

Exporters sell their debts under a forfating agreement without recourse basis, which means that once the debt is sold the non-payment risk passes to the forfaiter.

What would be happening to the original payment obligation will not be concerning the sellers after that point.

Forfaiting can be applied to a wide range of trade related and purely financial receivables typically have maturities from 3 months to 10 years.
Forfaiting can be applied to both international and domestic transactions.
100% financing without recourse to the seller of the debt
The payment obligation is often but not always supported by a bank guarantee
The debt is usually evidenced a legally enforceable and transferable payment obligation such as a bill of exchange, promissory note or letter of credit.
Transaction values can range from US$100,000 to US$200 million
Debt instruments are typically denominated in one of the world’s major currencies, with Euro and US Dollars being most common.
Finance can be arranged on a fixed or floating interest rate basis. (1)

Basic Forfaiting Transaction Explained with the Help of an Illustration

Below you can find basic forfaiting transaction which is explained with help of an illustration.

Step 1 : Forfaiter and Exporter agreed upon a Forfaiting Agreement.
Step 2 : Sales Contract has been signed between Exporter and Importer.
Step 3 : Shipment is initiated by the exporter.
Step 4 : The importer obtains a guarantee from his bank.
Step 5 : The importer obtains a guarantee from his bank.
Step 6 : Exporter gives documents to forfaiter.
Step 7 : Forfaiter controls the documents pays for them as indicated on the Forfaiting Agreement.
Step 8 : Forfaiter presents documents to bank at maturity date.
Step 9 : Importer pays to bank at maturity date.
Step 10 : Bank pays to forfaiter at maturity date.

Sources:

ITFA Website : http://itfa.org/trade-forfaiting/what-is-forfaiting/

What are the Differences Between a Bill of Lading and a Charter Party Bill of Lading?

By

Ozgur Eker (CDCS)

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2 December 2018

0

Under the current letter of credit rules and international standard banking practices, if a letter of credit calls for a marine bill of lading, then banks do not accept a charter party bill of lading in lieu of a marine bill of lading.

On this article I will try to answer the question “Why a charter party bill of lading is not acceptable in place of a marine bill of lading?” by clarifying the main differences between each transport documents.

Differences Between a Charter Party Bill of Lading and Marine Bill of Lading:

Charter Party Clause: Charter party bill of lading contains a clause stating that it is subject to a charter party. Marine bill of lading does not contain such a clause or similar wording.

Signatures:

Marine bills of lading can be signed by;
- the carrier or a named agent for or on behalf of the carrier, or
- the master or a named agent for or on behalf of the master.
Charter party bills of lading can be signed by;
- the master or a named agent for or on behalf of the master, or
- the owner or a named agent for or on behalf of the owner, or
- the charterer or a named agent for or on behalf of the charterer.

Usage:

Charter party bills of lading will be used mainly for big bulk shipments such as 20.000 mtons of soybean transportation from a US port to a Chinese port.
Marine bills of lading mostly used for containerized cargo that is transported by regular line container vessels.

Examples of Charter Party Clauses:

Below indications could turn a marine bill of lading into a charter party bill of lading. (Source : www.commerzbank.com)

“Prepayable freight paid as per charter party dd. …”
“Freight payable as per charter party dd. …”
“Freight as agreed”
“Bill of lading to be used with charter parties”

What is Congenbill Bill of Lading?

By

Ozgur Eker (CDCS)

-

1 December 2018

0

Congenbill is a type of charter party bill of lading which is widely used in international transportation.

Congenbill 2007 is the latest version of standard charter party bill of lading which is issued and approved by the BIMCO’s Documentary Committee.

BIMCO is a well established international shipping association and its long form is also known as “The Baltic and International Maritime Council”.

Congenbill 2007

According to the UCP 600 rules a bill of lading which contains an indication that it is subject to a charter party will be classified as a charter party bill of lading. Congenbill 2007 Bill of Lading indicates on its face “To be used with charter parties”. This makes Congenbill 2007 a charter party bill of lading according to the letter of credit rules.
The Congenbill Charter Party Bill of Lading can be used wide range cargo that does not need special handling. Because of this reason it is one of the most popular Charter Party Bill of Lading (CPBL) in use.
Sample Congenbill 2007 bill of lading is reachable from this link.

There are other charter party bills of ladings that have been issued by BIMCO. These are specific charter party bills of lading suitable for limited niche charter party operations.

Some examples of specific charter party bills of lading issued by BIMCO:

AUSTWHEAT BILL
BIMCHEMVOYBILL 2008
CEMENTVOYBILL 2006
INTANKBILL 78
GRAINCONBILL

NewsPaper

ICC Banking Commission 2015 Events

About the ICC Banking Commission

Global Payments Report 2014:

What are the Headings of URF 800?

How URF 800 Can be Applied to Forfaiting Transactions ?

Some Important Benefits of ICC Forfaiting Rules:

Where to Buy the URF 800 Book?

What are the Main Characteristics of Forfaiting?

Basic Forfaiting Transaction Explained with the Help of an Illustration

Sources:

Differences Between a Charter Party Bill of Lading and Marine Bill of Lading:

Examples of Charter Party Clauses:

Congenbill 2007

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