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Trade Finance Courses

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PUBLIC COURSES

• International Trade Finance• The Advanced Trade Finance Course• International Trade Finance Masterclass• Letters of Credit• Structured Trade & Commodity Finance• Trade Based Money Laundering and Sanctions Compliance

IN-HOUSE COURSES

• Trade Finance Sales• Examination Of Documents Under Documentary Credits• Risk in Trade Finance & Trade Finance Products• Trade Finance for Lawyers• Invoice Discounting (Domestic & International) - A Two

Day Workshop Style Course

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Course Content

International Trade FinanceDate: 05-06 Feb 2018, 12-13 Nov 2018

Location: London Standard Price: £995 + VATMembership: £796 + VAT

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Course Overview

Participants will learn how to identify customer needs and recommend appropriate product solutions, as well as assess various risks to both bank and customer in international trade transactions.

They will also gain an ability to explain and identify ways of mitigating the underlying risks associated with trade finance transactions and carry out the processes involved in documentary collections, documentary letters of credit and contract guarantees.

The international trade finance course will also address the purpose and application of the various International Chamber of Commerce rules and practices as used in international trade, identify customer needs for finance of exports/imports and explain the features and benefits of each method.

Role of Banks in International Trade Incoterms 2010 and Methods of Settlement ■ General Risk Considerations

• Know Your Customer• Correspondent Banking Risk• Counterparty Risk

■ The advantages/disadvantages to Importer/Exporter in the use of Incoterms 2010 and in the main methods of settlement.

Case Study: Short exercise to check understanding of Incoterms application.

Key characteristics of Commercial Documents International Trade ■ Invoices (commercial, tax, customs, consu-

lar, pro-forma invoice) ■ Marine/Ocean Bills of Lading

• Title, transfer • Control over goods (transferable B/L v.

straight consigneed)• Delivery of goods

■ Multimodal Transport Document ■ Air Transport Document ■ Road, Rail or Inland Waterway Transport

Documents ■ Insurance Policy/Certificate ■ Certificate of Origin (main types, GSP form

A) ■ Certificate of Inspection

This session is run using ‘a full set of commercial documents’ which enables the participant to understand the technical content, the linkage between each document and importance of each document as used in the sale and movement of goods internationally. Export/Import Documentary Collections

■ Relationship between Principal and Remitting Banker

■ Relationship between Correspondent Banks (agency arrangements)

■ Legal and practical issues regarding the duties of the banks involved in handling collection (remitting bank, collecting bank, presenting bank)

■ Conditions for release of documents ■ Difficult areas of risk:

• Partial payments • Avalising • Consignment of goods to banks • Release of goods on trust

■ Procedures for Protest and underlying risks ■ Complexities of the Uniform Rules for Collec-

tion ICC 522 Case Study: Several practical case studies which checks understanding of the collections procedure and the practical application of the URC 522. Documentary Letters of Credit – Introduction ■ Banker/Customer Relationship ■ Risk factors when issuing letters of credit ■ The autonomy of letter of credit operations

(Independence Principle) ■ Contract between Applicant and Issuing bank

- reducing riskCase Study: Group Q & A on ‘Bank Considerations’ when requested to issue Letter of Credit on behalf of corporate clients. Instructions to issue/amend credits ■ The importance of the application form (legal

issues) ■ Workability of the credit ■

Case Study: Involves checking customer Application and formal issue of the Letter

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Course Content

of Credit Introduction to the International Chamber of Commerce UCP 600 Rules: ■ Structure and obligations under documen-

tary credits; ■ Availability of credits: Expiry date and

place for presentation ■ Availability by payment, deferred pay-

ment, acceptance, deferred payment standard for examination of documents; dealing with discrepant documents, waiver and notice of refusal;

Case Study: Questionnaire which ensures familiarisation and understanding the varied Articles within UCP 600

Examination of documents ■ Key elements of the main articles of UCP

600 ■ The standard for examination of docu-

ments: “no conflict” rule – article 14 ■ Processing non-compliant documents as

Nominated/Confirming Bank ■ Processing non-compliant documents as

Issuing Bank ■ Risks arising from non-adherence to UCP

600 ■ Legal cases and ICC Banking Commission

opinions ■ DOCDEX – dispute settlement mechanism

of ICC for trade finance ■ Analysing irregularities in documents

Case study: Examination of documents presented under an LC. Analysing problem scenarios affecting payment and rejection of documents, including legal considerations, ICC opinions and dispute resolution International Standard Banking Practice ISBP 745 (2013 Rev) ■ What constitutes an “alteration” or “ad-

dition” to a document, when and how should these be authenticated?

■ How should documents be signed, if this is not explicitly stated in the credit?

■ How should one handle typing errors on documents regarding the name and ad-dress, different addresses of same compa-ny, etc.?

Instructions to advise and confirm credits ■ Obligations and Risks associated with the

Advising Bank, Nominated Bank, Confirm-

ing Bank ■ The use of the Bill of Exchange in Letters

of Credit Application of the Uniform Rules for Bank-to-Bank Reimbursement ICC 725 ■ Rationale ■ Concerns ■ Familiarisation of articles, including: types,

parties, issuance, documents and pres-entation

Assignment of ProceedsCase Study: Read through various official bank docu-ments relating to the above issues and discuss best prac-tice and compatibility with local laws and practice Specialised Letters or Credit Case Study: Participants work in groups and analyse various ‘customer need’ scenarios in order to provide the most appropriate and practical solutions. ■ Transferable: procedure, risks, UCP 600

article 38 in detail ■ Back-to-Back: procedure, risks ■ Red Clause and Green Clause Credits ■ Revolving & Reinstatement Credits ■ Standby Letters of Credit: the purpose and

procedure Guarantees ■ Two main categories: ■ Types of guarantees:

• Tender/bid bonds • Advance payment guarantees • Performance bonds • Retention money guarantees • Warranty Guarantees (Maintenance

guarantees) • Bail bonds • Payment guarantees• Indemnities/counter guarantees

■ Risk Assessment ■ Wording of Guarantees ■ Demand under guarantees: issues ■ Extend or Pay demands ■ Expiry and Cancellation ■ Uniform Rules for Demand Guarantees

758: main principles, URDG 758 guarantee sample wording, sample clauses

Case Study: Analyse and comment on guarantees which caused a loss to the bank. Discuss the practical application of URDG 758 and potential for use in local banking practice and legal jurisdictions. Examine the wording of a range of guarantees issued by banks abroad.

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Course Content

The Advanced Trade Finance CourseDate: 07-08 Feb 2018, 14-15 Nov 2018

Location: London Standard Price: £1,050+VATMembership: £840 + VAT

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Course Overview

Day One:The Current Market Place ■ Recent evolution and current developments ■ The challenge of emerging markets ■ The challenge of China ■ Brexit ■ President Trump ■ New products ■ The traditional three bands of clients: Global

and Large Corporate, MME’s, the rest! ■ Understanding trade finance at a fundamen-

tal level.’ ■ Typical users of Trade Finance products and

servicesFinancial Crime Compliance & Sanctions ■ Understanding the risk based approach

Trade Finance has been “re-discovered” yet remains a little mysterious. It is a product that has always generated strong revenues- often non funds based – and traditionally has exceptionally low credit losses (on a portfolio basis). Most global banks are able to apply very low probability of default ratios and usually lose as much to fraud as to actual credit losses.

The major general challenge to trade finance in recent times has been the impact of Financial Crime Compliance and Sanctions. Whilst credit losses and hence credit risk is low, FCC risk is very high because of the increasing tendency for global trade to pass through more than one country, use different modes of transport, use different currencies and transit through some regions where money laundering controls are not as strong as in others. This makes the audit trail very challenging. This is not a course about FCC but as trade finance is reckoned to be the main driver for money laundering, it needs to be understood.

To compound matters, many global banks have reduced their correspondent banking networks by up to two thirds – often based on the Transparency International CPI. This means it is becoming increasingly likely that more than two banks are involved in a transaction, causing delays in processing and frustration for the client. Sight LC’s can take 10-15 working days to be processed when there are two to three advising banks. Of course this has created opportunities for confirmation activities – provided FCC clearance is obtained.

Another challenge of trade finance is the tendency for banks to re-invent the wheel by using impressive sounding and not always easy to define marketing names to describe “new” products which are not actually new. “Buyer centric supply chain solution” actually is the sexier name for reverse factoring.

A final but by no means unimportant challenge is the uncertainty surrounding Brexit – where there remains a serious lack of clarity – and the impact of the Trump presidency in a few weeks’ time. One piece of good news is the Deutsche Bank settlement which might otherwise have led to a rescue.

In the market place dire predictions about the “death” of documentary credits are looking misplaced. It has been said repeatedly that the Open Account method of trading will eventually become the new normal having already taken a near 80% plus share of total trade transactions. Despite this, the LC refuses to die and against all expectations has become more important in the last few years. There are two reasons. Firstly, LC’s can be used to transfer the growing number of macro-economic and political risks (if “Confirmed”). Secondly several countries struggling with the collapse of energy prices now insist that L/C’s (and other instruments) are used as a method of recording and tracking the international flows of both goods and foreign currency.

This practical two day advanced level course will concentrate on what is happening in the market right now leaving delegates with a clear and working knowledge of how trade finance is undertaken in the real world, what actually happens and what are the implications for all parties concerned.

A good working knowledge and familiarity with International Trade finance is required to derive the maximum benefit from this course.

■ Impact on Trade Finance ■ TI, CPI and its impact ■ FATF ■ DDD and the need to obtain a clear line of

sight across the value chain ■ Money laundering methodologies ■ Ghost payments and variations ■ Under/over invoicing and variations ■ Documentary fraud ■ PEPS ■ Sanctions ■ Risk mitigation, management and transfer

Case Study/Exercise

Traditional Risks – The Critical Issues ■ Understanding, identifying and managing

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Course Content

risk ■ Credit risk, Market risk & Operational risk ■ Sovereign, Political / Country risk ■ Institutional risk / Bank risk ■ Corporate and other critical risks ■ Importer and Exporter’s risk ■ Other risks in the transaction and how to

mitigate them (transport risk, warehousing, force majeure, etc.)

■ Risk mitigation, management and transfer

Case Study/Exercise

Review of Key Products ■ How does the customer analyse his risk? ■ Which products does he use and why? ■ Payment in Advance ■ Open Account ■ Collections – Outward & Inward / Clean &

Documentary ■ Letters of Credit (covered in more detail

below) ■ Risks and opportunities ■ Control possibilities

Case Study/Exercise Supply Chain Management & Finance ■ The origins of SCM and what does it mean in

practice ■ Understanding the issues in SCM – “the tug

of war” between supplier & buyer ■ Bringing about a “balance” between parties

for effective processing ■ Understanding about movement of ‘informa-

tion’ ,’goods’ and ‘cash’ ■ Supply Chain Finance Main SCF models:

accounts payable - centric, accounts receiv-able, BPO

■ Review the risk aspects of SCF Case Study/Exercise

Letters of Credit (L/Cs) ■ Traditional L/C’s ■ The four contract concept ■ Confirmations ■ Red Clause ■ Green clause ■ Revolving L/Cs ■ Evergreen ■ Transferable L/Cs ■ Back to Back L/C structures

Case Study/Exercise

Standby Letters of Credit ■ History and origin ■ The dominant trade finance product ■ Uses ■ Risk management ■ Issue and assessment

■ Pricing ■ Understanding the applicability of ISP98 and

UCP 600 for standbys ■ Fraud and unfair calling

Case Study/Exercise

Export Finance issues ■ Looking at the big picture ■ Understanding the purpose of borrowing ■ Country risk issues ■ The reality of title and control ■ Negotiation under letters of credit ■ Discounting of deferred payment L/C, accept-

ance credits (with or without recourse) Case Study/Exercise

Controlling Credit Exposure – Formulating a Limit ■ Understanding and explaining the trade cycle ■ The use of time lines ■ Assessing and appreciating funding gaps

Case Study/Exercise

Day Two:

Structuring Finance for the Trader ■ Analysing the trade flows ■ Assessing facility size and structure ■ Specific lending with identifiable maturity

dates ■ Appreciating and controlling sources of repay-

mentCase Study/Exercise

Effective Use of Collections for Short-Term Finance ■ Using collections as financing opportunities ■ Identifying and mitigating risks ■ Maintaining control

Supporting the Trader ■ Using the goods as collateral ■ Assessing the value of goods ■ The value of pledges and trust receipts ■ The need for structured lending

Case Study/Exercise

Warehousing of Goods ■ Warehouse location ■ Management assessment ■ Legal frameworks ■ Obtaining and retaining title and control ■ Risks and responsibilities of Collateral Manag-

ers ■ Cost versus control

Case Study/Exercise

International Demand and Contract Guarantees / Bonds



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Course Content

■ Scope and Application – an introduction (sure-tyship v. demand guarantee)

■ Indemnities versus guarantees ■ Different types - Bid, Performance, Advance

payment, Warranty and Retention bonds ■ Rules governing guarantees and bonds ■ Legal jurisdiction and expiry date issues ■ Value of using URDG 758 – ICC Rules for de-

mand guarantees ■ Impact of non-bank competitors – COFACE,

Euler Hermes Case Study/Exercise

Receivables Financing ■ Mechanics of Factoring and Invoice Discount-

ing ■ Forfaiting – an important adjunct to the TF

mechanism ■ Role of Credit Insurance ■ Mechanics of Securitisation ■ FCC risks

Case Study/Exercise

The Commodity Sector and its Players ■ History and origins of the commodity industry ■ Understanding the nature of ’commodities’ ■ Analysing the players – growers / producers;

traders and end-users ■ Financing of commodities ■ Looking beyond the balance sheet ■ Available documentation – taking and retain-

ing title ■ Commodity futures, options and derivatives ■ Hedging – a critical process in commodity

finance ■ Role and function of the exchanges ■ Main risks in the commodity trade (market,

fraudulent practices, legal issues, recent legal cases)

Countertrade ■ Overview – when to use ■ Pitfalls and complications ■ Possible structures and Time management

Syndications ■ When to syndicate ■ Lead or participant role ■ The completion from capital markets – high

yield bonds ■ Selling down exposure ■ Impact of quasi-governmental agencies ■ Risk/reward analysis

Case Study/Exercise

Course Conclusion and Review / Feedback


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Course Content

International Trade Finance MasterclassDate: 05-08 Feb 2018, 12-15 Nov 2018

Location: London Standard Price: £1,995 + VATMembership: £1,596 + VAT

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Course Overview

On days one, two and three, Participants will learn how to identify customer needs and recommend appropriate product solutions, as well as assess various risks to both bank and customer in international trade transactions.

They will also gain an ability to explain and identify ways of mitigating the underlying risks associated with trade finance transactions and carry out the processes involved in documentary collections, documentary letters of credit and contract guarantees.

The course will also address the purpose and application of the various International Chamber of Commerce rules and practices as used in international trade, identify customer needs for finance of exports/imports and explain the features and benefits of each method

On the last two days the course is advanced and will provide delegates who are already familiar with or are working in a trade finance environment, with an insight into the more complex trade finance techniques that are becoming more common.

International Trade has always been the engine for global economic growth and is playing an ever important role, as new powerful economies emerge, shifting the balance of trade influence from the traditional wealth creators to new regions and economies.

This advanced course will provide delegates who are already familiar with or are working in a trade finance environment, with an insight into the more complex trade finance techniques that are becoming more common.

Much of complex International Trade is either misunderstood or undervalued mainly because the terminology and practices seem difficult and confusing to master. This course will completely de-bunk this misconception and will leave delegates with a clear and working knowledge of how trade is undertaken at its most complex level.

It will show what actually happens and just how profitable this section of a bank’s business can be. It will also suggest methods of handling problems when things go wrong.

At the end, all delegates will have a clear and full understanding of exactly how complex trade takes place across the globe at an advanced level.

A good working knowledge and familiarity with International Trade finance is required to derive the maximum benefit from this course.

Role of Banks in International Trade Incoterms 2010 and Methods of Settlement ■ General Risk Considerations

• Know Your Customer• Correspondent Banking Risk• Counterparty Risk

■ The advantages/disadvantages to Import-er/Exporter in the use of Incoterms 2010 and in the main methods of settlement.

Case Study: Short exercise to check understanding of Incoterms application.

Key characteristics of Commercial Documents International Trade

■ Invoices (commercial, tax, customs, consu-lar, pro-forma invoice)

■ Marine/Ocean Bills of Lading• Title, transfer • Control over goods (transferable B/L v.

straight consigneed)• Delivery of goods

■ Multimodal Transport Document ■ Air Transport Document ■ Road, Rail or Inland Waterway Transport

Documents ■ Insurance Policy/Certificate ■ Certificate of Origin (main types, GSP form

A) ■ Certificate of Inspection

This session is run using ‘a full set of commercial documents’ which enables

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International Trade Finance MasterclassContinued

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Course Content

the participant to understand the technical content, the linkage between each document and importance of each document as used in the sale and movement of goods internationally. Export/Import Documentary Collections ■ Relationship between Principal and Remit-

ting Banker ■ Relationship between Correspondent Banks

(agency arrangements) ■ Legal and practical issues regarding the

duties of the banks involved in handling collection (remitting bank, collecting bank, presenting bank)

■ Conditions for release of documents ■ Difficult areas of risk:

• Partial payments • Avalising • Consignment of goods to banks • Release of goods on trust

■ Procedures for Protest and underlying risks ■ Complexities of the Uniform Rules for Col-

lection ICC 522 Case Study: Several practical case studies which checks understanding of the collections procedure and the practical application of the URC 522. Documentary Letters of Credit – Introduction ■ Banker/Customer Relationship ■ Risk factors when issuing letters of credit ■ The autonomy of letter of credit operations

(Independence Principle) ■ Contract between Applicant and Issuing

bank - reducing riskCase Study: Group Q & A on ‘Bank Considerations’ when requested to issue Letter of Credit on behalf of corporate clients. Instructions to issue/amend credits ■ The importance of the application form (le-

gal issues) ■ Workability of the credit

Case Study: Involves checking customer Application and formal issue of the Letter of Credit Introduction to the International Chamber of Commerce UCP 600 Rules: ■ Structure and obligations under documen-

tary credits; ■ Availability of credits: Expiry date and place

for presentation

■ Availability by payment, deferred payment, acceptance, deferred payment standard for examination of documents; dealing with discrepant documents, waiver and notice of refusal;

Case Study: Questionnaire which ensures familiarisation and understanding the varied Articles within UCP 600

Examination of documents ■ Key elements of the main articles of UCP 600 ■ The standard for examination of documents:

“no conflict” rule – article 14 ■ Processing non-compliant documents as

Nominated/Confirming Bank ■ Processing non-compliant documents as Is-

suing Bank ■ Risks arising from non-adherence to UCP 600 ■ Legal cases and ICC Banking Commission

opinions ■ DOCDEX – dispute settlement mechanism of

ICC for trade finance ■ Analysing irregularities in documents

Case study: Examination of documents presented under an LC. Analysing problem scenarios affecting payment and rejection of documents, including legal considerations, ICC opinions and dispute resolution International Standard Banking Practice ISBP 745 (2013 Rev) ■ What constitutes an “alteration” or “addition”

to a document, when and how should these be authenticated?

■ How should documents be signed, if this is not explicitly stated in the credit?

■ How should one handle typing errors on documents regarding the name and address, different addresses of same company, etc.?

Instructions to advise and confirm credits ■ Obligations and Risks associated with the

Advising Bank, Nominated Bank, Confirming Bank

■ The use of the Bill of Exchange in Letters of Credit

Application of the Uniform Rules for Bank-to-Bank Reimbursement ICC 725 ■ Rationale ■ Concerns




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Course Content

■ Familiarisation of articles, including: types, parties, issuance, documents and presenta-tion

Assignment of Proceeds

Case Study: Read through various official bank documents relating to the above issues and discuss best practice and compatibility with local laws and practice Specialised Letters or Credit Case Study: Participants work in groups and analyse various ‘customer need’ scenarios in order to provide the most appropriate and practical solutions. ■ Transferable: procedure, risks, UCP 600

article 38 in detail ■ Back-to-Back: procedure, risks ■ Red Clause and Green Clause Credits ■ Revolving & Reinstatement Credits ■ Standby Letters of Credit: the purpose and

procedure Guarantees ■ Two main categories: ■ Types of guarantees:

• Tender/bid bonds • Advance payment guarantees • Performance bonds • Retention money guarantees • Warranty Guarantees (Maintenance guar-

antees) • Bail bonds • Payment guarantees• Indemnities/counter guarantees

■ Risk Assessment ■ Wording of Guarantees ■ Demand under guarantees: issues ■ Extend or Pay demands ■ Expiry and Cancellation ■ Uniform Rules for Demand Guarantees 758:

main principles, URDG 758 guarantee sam-ple wording, sample clauses

Case Study: Analyse and comment on guarantees which caused a loss to the bank. Discuss the practical application of URDG 758 and potential for use in local banking practice and legal jurisdictions. Examine the wording of a range of guarantees issued by banks abroad.

The Market ■ Historical evolution and current develop-

ments in the market place ■ Trade Finance versus ‘balance sheet lend-

ing’ ■ Understanding and controlling the cash

flow ■ Typical users of Trade Finance products

and services

Risk – The Critical Issues ■ Understanding, identifying and managing

risk ■ Sovereign, Political / Country risk ■ Institutional risk / Bank risk ■ Corporate and other critical risks ■ Importer and Exporter’s risk ■ Other risks in the transaction and how to

mitigate them (transport risk, warehous-ing, force majeure, etc.)

■ Risk mitigation, management and transfer

Review of Key ProductsHow does the customer analyse his risk? ■ Which products does he use and why? ■ Payment in Advance ■ Open Account ■ Collections – Outward & Inward / Clean &

Documentary ■ Letters of Credit (covered below) ■ Risks and opportunities ■ Control possibilities

Supply Chain Management & Finance ■ The origins of SCM ■ Understanding the issues in SCM – “the

tug of war” between supplier & buyer ■ Identifying Market Opportunities ■ Bringing about a “balance” between par-

ties for effective processing ■ Understanding about movement of ‘infor-

mation’ ,’goods’ and ‘cash’ ■ Supply Chain Finance – not just a new

opportunity but an essential element for sustainable business

■ Main SCF models: accounts payable - cen-tric, accounts receivable – centric, other models (four corner model of BPO)

■ Review the risk aspects of SCF

Letters of Credit (L/Cs) - Advanced Mechanisms

The mechanics and use of: ■ Revolving L/Cs ■ Transferable L/Cs




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Course Content

■ Back to Back L/C structures Pre-Export Finance ■ The effective use of red and green clause

letters of credit ■ Packing and manufacturing credits

Post-Export Finance ■ Negotiation under letters of credit ■ Discounting of deferred payment L/C,

acceptance credits (with or without re-course)

Export Finance issues ■ Looking at the big picture ■ Understanding the purpose of borrowing ■ Country risk issues ■ The reality of title and control

Controlling Credit Exposure – Formulating a Limit ■ Understanding and explaining the trade

cycle ■ The use of time lines ■ Assessing and appreciating funding gaps

Structured Trade Finance Situations (apart from Case Studies) ■ Analysis of 2-3 examples based on above

situations

Structuring Finance for the Trader Facility Management: ■ Analysing the trade flows ■ Assessing facility size and structure ■ Specific lending with identifiable maturity

dates ■ Appreciating and controlling sources of

repayment

Effective Use of Collections for Short-Term Finance ■ Using collections as financing opportuni-

ties ■ Identifying and mitigating risks ■ Maintaining control

Supporting the Trader ■ Using the goods as collateral ■ Assessing the value of goods ■ The value of pledges and trust receipts ■ The need for structured lending

Warehousing of Goods ■ Warehouse location ■ Management assessment ■ Legal frameworks ■ Obtaining and retaining title and control ■ Risks and responsibilities of Collateral Man-

agers ■ Cost versus control

International Demand and Contract Guarantees / Bonds ■ Scope and Application – an introduction

(suretyship v. demand guarantee) ■ Different types - Bid, Performance, Ad-

vance payment and Retention bonds ■ Rules governing guarantees and bonds ■ Legal jurisdiction and expiry date issues ■ Value of using URDG 758 – ICC Rules for

demand guarantees ■ Opportunity spotting ■ Standby L/C’s (SBLCs) ■ Understanding the applicability of ISP98

and UCP 600 for standbys

Receivables Financing ■ Mechanics of Factoring and Invoice Dis-

counting ■ Forfaiting – an important adjunct to the

TF mechanism ■ Role of Credit Insurance ■ Mechanics of Securitisation ■ Nightmare scenarios

The Commodity Sector and its Players ■ History and origins of the commodity in-

dustry ■ Understanding the nature of ’commodities’ ■ Analysing the players – growers / produc-

ers; traders and end-users ■ Financing of commodities ■ Looking beyond the balance sheet ■ Available documentation – taking and re-

taining title ■ Commodity futures, options and deriva-

tives ■ Hedging – a critical process in commodity

finance ■ Role and function of the exchanges ■ Main risks in the commodity trade (market,

fraudulent practices, legal issues, recent legal cases)

Countertrade ■ Overview – when to use ■ Pitfalls and complications ■ Possible structures and Time management



Letters of CreditDate: 13-14 Jun 2018, 07-08 Nov 2018

Location: London Standard Price: £1,050 +VAT Membership Price: £850 +VAT

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Course Overview

Trade Finance has always been regarded as a little mysterious. It delivers strong revenue, has low credit losses (normally) and employs products with impressive sounding and not always easy to define names. Even more intriguing is the frequent use of different terms which apparently mean the same thing. Letters of Credit fit neatly into this conundrum. They are not actually letters, many don’t actually grant credit, they employ strange sounding terms, they are used to support about 15% of global trade and to cap it all, the mainstream version - “the Standby” - is issued with the expectation that no payment will ever be made to the beneficiary.

Fortunately – a bit like learning to read music for the first time – once the language is explained, the customs and the practice of trade finance are unveiled and the terminology is understood fully, there really isn’t too much to it. It is, in reality, easy to understand and takes just a bit of practice to master.

Interestingly, dire predictions about the “death” of documentary credits still persist. It has been said repeatedly that the Open Account method of trading will eventually become the new normal having already taken a near 80% plus share of total trade transactions. Despite this, the LC refuses to die and against all expectations has become more important in the last few years. There are two reasons. Firstly, LC’s can be used to transfer the growing number of macro-economic and political risks (if “Confirmed”). Secondly several countries struggling with the collapse of energy prices now insist that L/C’s (and other instruments) are used as a method of recording and tracking the international flows of both goods and foreign currency.

This practical two day course will completely remove the “mystery” of the subject, leaving delegates with a clear and working knowledge of how trade finance is undertaken in the real world, what actually happens and what are the implications for all parties concerned. It considers the use, implementation and practical applications of documentary letters of credits (LC’s) in their many forms and guises including Standby L/C’s.

Financial Crime Compliance (FCC)The course will cover fully the significant impact FCC is having on trade finance in general and LC’s in particular

Course MethodologyThe course will use numerous case studies and will involve a considerable element of interactive class discussions. The Director will encourage delegates to question and test their knowledge at each stage of the course. At the end, all delegates will have a clear and full understanding of exactly how LC trade takes place currently across the globe at almost every level.

About the Course DirectorYour course director has spent more than 40 years in banking, much of it in International Trade at all levels of client. He is a former Institute of Banking Lecturer on the topic, having gained a distinction in the subject. He has lectured extensively to all the leading trade finance banks including the world’s largest institutions. He has delivered extensive programmes to banks in all parts of the world including the USA, Europe, MENA, Africa and Hong Kong. He is currently an accredited Master Trainer for the biggest trade finance bank.

Course Content

Overview of Trade Finance ■ Principles of trade finance ■ Parties to a transaction ■ Roles, obligations, interests

Banks in Trade Finance ■ Core Services ■ Structured Services ■ Interaction with ECA’s and others

■ Importance of banks in promoting com-merce

■ The value proposition

Regulatory Context - overview ■ UCP ■ URDG ■ Incoterms ■ UCP600 ■ Jurisdiction ■ Compliance

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Transaction/Product Overview ■ Open account ■ Collections ■ Documentary credits ■ Guarantees and standby letters of credit ■ Payment in advance

Trade Finance & Risk ■ Overview of selected risks ■ Mitigation options

Documentary Letters of Credit - Definitions ■ Definition of Documentary Letters of Credit

(L/C’s) ■ Parties to a credit ■ Contractual relationships ■ Confirmed L/C’s ■ Terms of payment ■ Transferable & Back to Back L/C’s ■ Red Clause ■ Green Clause ■ Confirmed ■ Silent confirmation ■ Other Features of L/C’s

Documentary Letters of Credit - Applications ■ Observations on financing ■ Acceptances ■ Discounting ■ Aval ■ Factoring ■ Forfaiting ■ Other finance mechanisms ■ Buyer/supplier credits ■ Checking, honouring & negotiation of docu-

ments ■ Obligations and responsibilities of the par-

ties

UCP 600 ■ Practical application of these latest rules ■ Changes from UCP 500 ■ Practical issues ■ Challenges ■ Key legal decisions (Santander v Paribas,

CIC v CMB)

International Standard Banking Practice 2013 ■ Introduction ■ UCP not amended. Emphasis on integration ■ Detailed practices when working with differ-

ent trade documentation ■ Documents not covered by UCP ■ Packing lists, Weight lists ■ Beneficiary certificate ■ Non-negotiable sea waybill ■ Analysis inspection, health, phytosanitary,

quantity & quality certificates

Transferable Credits ■ Advantages ■ Disadvantages ■ Risks ■ Key legal issues ■ Implications for parties ■ Client interests ■ Acceptability

Red & Green Clause (Advance Payment) Credits ■ Pre-export finance applications ■ Role on the market ■ Financing mechanisms ■ Structural analysis ■ Risks for each party ■ Risk mitigation & control

Revolving Credits ■ Structure ■ Mechanism ■ Automatic restrictions ■ Amount or time, not usually both ■ Cumulative or non-cumulative

Evergreen Credits ■ Definition ■ Operation ■ Risks

Standby L/C’s ■ Evolution ■ Definition ■ Difference between SBLC and LC ■ Dominant role in trade finance ■ Main uses of SBLC’s ■ Receiving SBLC’s as security ■ Issuing SBLC’s ■ Common features ■ Benefits ■ ISBP98

Fraud in International Trade ■ L/C’s ■ Autonomy of L/C’s ■ Documents only weakness ■ Proof of fraud ■ Incidence ■ Basic fraud prevention

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Structured Trade and Commodity FinanceDate: 22-23 Jan 2018, 24-25 Sep 2018

Location: London Standard Price: £1,050+ VAT Membership Price: £840 + VAT

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Course Objectives

Participants will:

■ Be introduced to what is meant by structured trade and commodity finance ■ Learn about the markets, the softs, oils & gas and LME ■ Explore the grain, mean and tropical markets alongside new participants in those markets ■ Get to grips with emerging markets and the risks alongside how strucutred approaches assist and

what a “good” collateral is ■ Expand knowledge on pre-finance and the risks relating to grower/producer finance ■ Gain an understaind of the green clause and red clause credits ■ Master the key documentation as a risk mitigant ■ Learn about financing commodities, structures and risk management ■ Analyse warehousing and asset backed structures, warehouse receipts and WRF structues ■ Explore the collateral management and different types of insurance ■ Review mining, oil and gas finance alongside liquified natural gas.

Commodity markets have seen unprecedented price fluctuations in recent times making the sector much more challenging. The course will attempt to deal with these challenges but ultimately the whole sector remains inherently more risky than it was.Trade Finance remains the engine at the heart of global economic growth with China still probably the most important participant. Commodity Finance sits at the heart of this trade dominated by oil and gas which according to some estimates, accounts for as much as 70% of all commodity trade.

The impact of both Brexit and The Trump presidency are very hard to predict and both the short and medium term outlooks remain uncertain which is not helpful. Most markets are “holding their breath”. Similarly we have just seen the latest “agreement” by OPEC and others (primarily driven by Saudi Arabia) to restrict production and hopefully boost oil prices. Early signs show it is working but will it last?

Structured Trade and Commodity finance can mean many things and many banks will have their own particular definition. Generally speaking it is an activity dedicated to the financing of high-value supply chains. Every loan is tailor-made to client, transaction and region. They tend to be more long-term – sometimes up to five years.

Structured trade finance usually refers to the financing of cross-border commodity flows (and as such is most commonly known as structured commodity finance).

Structured commodity finance encompasses several different methods of finance for producers and traders of goods and commodities, including:Trading in commodities often involves dynamic and fast-moving commodity markets, often with counterparties in emerging market territories. Risk mitigation and the ability to swiftly devise structures to make available financing of transactions are keys to success.

Whilst ongoing innovations and technological developments make the market more transparent this can be a high risk area for the uninitiated or unprepared. As a commodity banker, trader or even a producer, a flexible and creative approach, balanced by an appropriate degree of caution, will minimise risks.

This course will highlight the key concepts involved in commodity trading with elements drawn from real situations. It will also cover liquidity issues and lightly traded commodities.

Your FacilitatorHas over 40 years in the banking and trade finance sectors. His career was sent initially with Lloyds Bank plc and then as a main board director of a specialist London based merchant bank.

He has delivered numerous successful public courses on this topic as well as in house trade and commodity financing programmes at an advanced level for Bank of China, HSBC, and Royal Bank of Scotland Group, Lloyds TSB, Commerz Bank, Garanti Bank as well as all the leading South African and Nigerian Banks

He is an approved external master trainer for the world’s largest trade finance bank and has trained extensively in the UK, USA, Europe, Scandinavia, Africa, Asia and the Middle East.

Course Overview

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Structured Trade & Commodity FinanceContinued

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Course Content

Introduction ■ What do we mean by structured trade ■ What is commodity finance ■ Categories of Commodities ■ Commodity Pricing – Volatility ■ The exchanges and their influence ■ The rise of techniques to manage risk ■ Participants ■ Current Trends

The Markets ■ The softs. ■ Oil & Gas ■ LME ■ The grain markets - the meat markets and

the tropical markets in coffee , cocoa, sugar, etc

■ Biofuels.- Ethanol ■ New participants in the market ■ Over / under supply ■ Traditional hedging techniques ■ The availability of data and access to the

markets ■ The concept of price insurance ■ Electronic platforms. ■ The rise of the indexes ■ Exchange Traded Funds

Emerging Markets ■ The risks ■ Political & Economic Risks and mitigants ■ Performance and operational risk and miti-

gants ■ Credit & Bank risks and mitigants ■ Price Risk ■ IForged, fraudulent or illegal contracts ■ Documents of title ■ Markets & Players ■ Risk analysis of a commodity transaction ■ How structured approaches assist ■ What is “good” collateral

Pre-Finance ■ The risks relating to grower/producer fi-

nance ■ Green Clause Credits ■ Red Clause Credits ■ Ownership issues ■ Licenses, export quotas, foreign currency

controls ■ Problems with non delivery ■ SBLC’s ■ Prefinance versus prepayment ■ Limited Recourse v unlimited recourse

Key Documentation as a Risk Mitigant ■ Transport documents ■ MMTD & BoL’s ■ Documents representing goods ■ Title, negotiability, endorsement ■ Incoterms

■ Charter-party contracts and contracts of af-freightment

■ Voyage time and trip transfers ■ Shipper/charterer and vessel owner obliga-

tions ■ Loading & discharge of cargo

Financing Commodities ■ Commodity contracts ■ Risk analysis of commodity flows ■ Risk analysis of key parties ■ The importance of document control – “follow

the doggy!” ■ Logistics & the value chain

Structures ■ Pre-export finance ■ L/C, SBLC and other structures ■ Tolling ■ Inventory finance & CMA’s ■ Asset backed finance ■ Countertrade structures

Risk Management ■ Risk mitigation ■ Exchange traded commodities ■ Links between cash & futures markets ■ Delivery to and from terminal markets ■ Cash flow acceleration ■ Off balance sheet considerations ■ Countertrade structures ■ Problems with MMTD transactions

Warehousing ■ Asset backed structures ■ The business case for warehousing ■ Warehouse receipts ■ WRF structures ■ Raising finance against warehouse backed

securities ■ Problems with pledges over inventory, physi-

cal dispossession ■ Legal requirements ■ Fraud, misrepresentation and similar issues ■ WH receipts – a document of title, or just a

receipt ■ Risk mitigation

Collateral Management ■ Liability of collateral managers ■ Collateral Management Agreement (CMA) ■ Negotiating CMA documents ■ Reviewing components of the CMA ■ Tolling finance ■ Performance and country risks ■ Non-delivery issues/problems ■ Financiers priorities ■ Insurance solutions

Insurance ■ Marine insurance



Structured Trade & Commodity FinanceContinued

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Course Content

■ ICC/A/B/C contingency cover ■ Security – assignment v loss payee ■ Political and country risk ■ Contract frustration ■ Asset confiscation ■ Credit insurance ■ Legal problems ■ Breach of warranty ■ Failure to act appropriately to mitigate in-

sured losses (acting as if uninsured)

Price Risks ■ Chinese influence ■ Price risk management ■ Price discovery exchange ■ Traded versus OTC ■ Cash and futures markets ■ Contracts to hedge ■ Bank v customer requirements/benefits

Mining Finance ■ Concept of the business ■ The cost to bring to market semi-finished

material ■ Inhospitable locations ■ Financing new mines ■ The lead/lag time for production ■ Technical developments and reworking older

mines ■ The issue of current and future price projec-

tions ■ Trading issues, hedging ■ Borrowing and Lending

Oil & Gas Finance ■ The energy complexes ■ Crude oil market ■ Buying oil on Wall Street ■ The role of the .majors ■ The supply demand equation ■ State intervention ■ The exploration and extraction of oil ■ Trading in crude oil. ■ Heating oil and gasoline ■ Gas market

LNG – Liquified Natural Gas ■ The energy complexes ■ The growth of the LNG debt market ■ LNG liquefaction finance: ■ LNG regas finance ■ LNG ship finance ■ Recent trends:

• Financing of integrated LNG chains• Changing downstream markets and trading

patterns• Increasing flexibility in LNG sales and fi-

nancing contracts



Course Content

Trade Based Money Laundering and Sanctions ComplianceDate: 28 Feb-2 Mar 2018, 10-12 Oct 2018

Location: London Standard Price: £1,800 +VATMembership: £1,440 + VAT

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Course Overview

Whilst trade and commodity finance is low in credit risk it exposes banks to high compliance risksBanks who have failed to have adequate AML and sanctions compliance programmes and training in place have incurred penal fines, reputational damage and faced the potential loss or suspension of their ability to operate in certain currency markets or jurisdictions

This 3 day course for bank auditors, compliance officers and relationship managers provides an explanation of the operation of the methods of payment and financing used in international trade and commodity transactions and the nature of compliance risks associated with each.

The course covers Correspondent Banking, International Payments, Global Cash Management, Trade & Commodity Finance and the compliance risk profile, and the suspicious money laundering and sanctions violation activity red flag indicators of each. Analysis is provided of the key features, the attractiveness and vulnerability of each trade product or structure to criminal activity.

This course will enable the delegates to identify compliance risk zones in each of these product areas and key aspects from an audit and compliance risk perspective.

The course uses a range of typologies, exercises and case studies to enable the delegates to consider transactions and identify the key risk compliance features, areas of due diligence and further information required to make a risk based assessment.

Course objectives ■ By attending this foundation level training course the delegates will understand the role, parties,

operation and compliance risks of: ■ Correspondent banking; the gateway to cross border compliance risk exposure together with its

fundamental role in the movement of international money flows ■ SWIFT messages; their function, operation and methods of abuse ■ International payments; the mechanics of direct, serial processing and cover payments ■ Global cash management; its function and operation of pooling/concentration accounts, and its

vulnerability to money laundering ■ Trade finance; collections, letters of credit (to include transferable and synthetic credits), standby

credits, on demand bank guarantees, receivables finance, forfaiting, payables finance and supply chain finance and the compliance risk profile of each

■ Structured commodity finance; pre-payment, pre-export, warehouse, tolling and receivables fi-nancing structures and compliance risk aspects

■ Red flag suspicious activity indicators and warning signals that can be used in cross border in-ternational trade transactions

Day 1What compliance risk is ■ An introduction to the nature of compliance

risk in cross border transactions ■ Why international trade transactions are

increasingly a target for abuse

Anti-money laundering (“AML”) ■ What money laundering is ■ The key stages of money laundering; place-

ment, layering, integration ■ The risk-based approach to anti-money

laundering

Typology – the use of over-inflated invoicing representing “management charges” to transfer illicit monies from an affiliate company Countering the financing of terrorism (”CFT”)

■ The characteristics of the cross border financ-ing of terrorist activities using trade transac-tions

■ Key differences between CFT and AML

Typology – the co-mingling of legitimate cross border trade wired receipts with terrorist financing funds by a diaspora owned business

Sanctions violation ■ What sanctions are, why they are imposed and

their intended impact ■ Trade embargo and financial sanction (to in-

clude export licensing and dual-use goods) ■ Global reach; the importance and implications

of the currency of payment ■ Sanctions; fundamentals of due diligence and

screening

Correspondent banking ■ What correspondent banking is and why this is

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Course Contnet

fundamental to cross border money flows ■ Gateway to compliance risk exposure; the

high risk nature of correspondent banking ■ Correspondent and respondent parties ■ An explanation of the use and operation of

Nostro, Vostro and Loro accounts

Exercise; Nostro, Vostro and Loro accounts

Correspondent banking infrastructure; ■ Message authentication; ■ Provision of payment, trade and treasury

services; ■ Cash management ■ Roles and risk profile of remitting, receiving

and reimbursement parties in cross border transactions

Exercise; due diligence and risk considerations

■ Correspondent banking; key areas of com-pliance risk

■ Know your customer; the impact of ”KYCC” ■ Key compliance risk zones:

• Ownership and control• Jurisdiction• Quality of jurisdictional regulatory and

supervisory framework• Adequacy of AML and sanctions compli-

ance procedures• Nature of respondent’s business• Client base• Shell banks• Direct access accounts• Downstream correspondents

Typology; the use by a shell bank of its correspondent banking network to move criminally obtained money across jurisdictions to purchase high value tradable goods

■ Financial Institutions as customers:• Compliance risk assessment framework;

key components• Compliance checklist; example

■ Unacceptable customers ■ Due diligence and risk assessment ■ Monitoring activity – warning signals ■ Red flags ■ Financial Action Taskforce (FATF); recom-

mendations: ■ Recent market trends in respect of compli-

ance challenges:• LEI (legal entity identifier)• Correspondent network rationalisation

• Serial payment processing versus the cover method

SWIFT messages ■ Their function and operation ■ The use and role of SWIFT “MT” message

types in:• Payments• Trade transactions

■ Compliance risk; message abuse: • Inappropriate use of message types• Message stripping

Case study; SWIFT payment message abuseInternational payments ■ The mechanics of how money is transferred

cross border ■ The nature of the payment instruction ■ Parties; remitter, originator bank, receiving

bank, beneficiary, cover/reimbursing bank ■ Methods of international bank transfer:

• Direct and serial processing method (the use of SWIFT MT 103)

• Cover method (the use of SWIFT MT103 plus SWIFT MT202 COV)

• The compliance risk implications of SWIFT MT202

• Value dating

Examples; direct, serial and cover methodsKey compliance risk zones: ■ Message information ■ Originator; ownership, jurisdiction ■ Beneficiary; ownership, jurisdiction ■ Nature and value of payment – ordinary

course of business? ■ Screening – designated persons – sanc-

tioned countries?Exercise; completion of payment related SWIFT messages ■ The compliance risk exposure of US dollar

transfers ■ High risk customers requiring payment ser-

vices ■ Red flag suspicious activity indicators

Alternative remittance services (ARS) ■ Types; money value transfer services

(MVTS), currency exchange offices/brokers ■ How they work ■ Potential for mis-use and compliance risk ■ Red flags

Global cash management (cash pooling) ■ Its role and function ■ Concentration/pooling, zero and target bal-

Trade Based Money Laundering and Sanctions Compliance




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Course Contnet

ancing ■ Parties; pool participants and banks ■ Key compliance risk zones:

• Pool participants; ownership, jurisdic-tion

• Nature of business• Correspondent/partner banks• Origin and nature of funds• Co-mingling of legitimate and illicit

monies ■ Monitoring activity – warning signals ■ Compliance risk profile

Case study; the use of a corporate group cross border cash concentration arrangement to mask the illicit origination of funds from a subsidiary participant and the recirculation of illicit monies in a disguised manner for apparent trade purposes

Day 2

The cost of non-compliance ■ Case studies; AML and sanctions viola-

tion

Trade financeIntroduction to trade finance; description, function and operation: ■ Conflicting requirements of sellers and

buyers ■ What trade finance is and why it is re-

quired ■ Why trade finance carries high compli-

ance risk ■ High risk customers; transactions; juris-

dictions Trade finance compliance risk charac-teristics; ■ Key compliance risk zones ■ Trade cycle appreciation – “know your

customer’s customer” ■ The different roles of banks; fragmented

bank involvement ■ Banks deal in documents – no responsi-

bility to validate ■ Negotiable instruments; implications for

compliance risk ■ Third party involvement; compliance risk

implications ■ The role of finance in cross border abuse

Comparison between international payments and documentary

trade finance in the compliance risk environment: ■ Automated screening ■ Message stripping ■ Manual based due diligence

Trade based money laundering (TBML) ■ An introduction to trade based money laun-

dering ■ Why it is becoming an increasing focus of

criminal activity ■ Common methods of trade based money

laundering

TRADE FINANCE PRODUCTS

Documentary collections ■ What collections are ■ Their role, parties and operation ■ Types; DP, DA, bank aval ■ Example transaction and trade documenta-

tion ■ Compliance risk assessment;

• Remitting bank due diligence• Collecting bank due diligence

■ Product compliance risk profileTypologies; examples of misrepresentation of invoice value, multiple invoicing and false description of goods as a means to attempt to legitimise the movement of illicit monies via trade flows

Letters of credit ■ What letters of credit are ■ Their role, parties and operation ■ Irrevocable undertaking to pay or honour

against complying documentation ■ The independence principle ■ Trade documentation; vulnerability to abuse

and compliance risk ■ Example transaction and trade documenta-

tion ■ Sanctions clausing ■ Differing and fragmented roles of banks; the

importance of LC availability ■ Payment terms ■ LC confirmation; financial engagement and

responsibilityCase study; the assessment of a potential money laundering cross border letter of credit transaction requiring delegates to identify key compliance risk issues and further information required to make a risk based assessment

Mechanisms for financing letters of credit ■ Compliance risk assessment; issuance, pres-





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Course Contnet

entation of documents, payment• Issuing bank• Advising bank• Negotiating bank

■ Product compliance risk profileCase study; delegates will be asked to identify unusual features of a letter of credit request and identify the red flag suspicious activity characteristics

Transferable letters of credit ■ What transferable letters of credit are ■ Their role, parties and operation ■ Transfer changes ■ Vulnerability to compliance risk ■ Product compliance risk profile

Case study; the assessment of a transferable letter of credit transaction with suspicion of breaching international trade sanctions. The delegates will be required to identify any unusual features, to identify key compliance risk issues and further information required to make a risk based assessment

Synthetic letters of credit ■ Description and operation ■ Parties ■ Product compliance risk profile

Case study; delegates will examine a transaction and identify the compliance risk aspects

Day 3

Case study; delegates will consider a request to issue a letter of credit which is not in the ordinary course of business of the applicant and to identify the nature of the underlying transaction ■ Forfaiting ■ What forfaiting is ■ Primary and secondary forfaiting trans-

actions ■ How to establish debt instrument au-

thenticity ■ The importance of due diligence; is there

an underlying trade transaction? ■ Product compliance risk profile

Case study; purchase of an avalised bill of exchange. Delegates will be required to undertake due diligence and identify further information required to undertake a compliance risk based assessment of the transaction

Receivables finance ■ What receivables finance is ■ Compliance risk vulnerabilities of financing

open account transactions ■ Forms of receivables finance:

• Full factoring• Confidential invoice discounting• Specific insured receivables finance

■ The use of receivables finance in the con-text of trade finance

■ Product compliance risk profileCase study; purchase of a trade receivable. Delegates will be required to undertake due diligence and identify further information required to undertake a compliance risk based assessment of the transaction

Standby letters of credit ■ What standby credits are and how they dif-

fer to letters of credit and bank guarantees ■ Their role, parties and operation ■ Example transaction; commercial standby

credit ■ Claim documentation ■ Its vulnerability to abuse; money launder-

ing and sanctions violation ■ Structuring standby credits to reduce com-

pliance risk exposure ■ Product compliance risk profile

Case study; delegates will be required to consider the course of action resulting from a suspicious claim under a standby LC and how the use of this product for money laundering can be reduced

“On demand” bank guarantees ■ What “on demand” bank guarantees are ■ Their role, parties and operation ■ The nature and risk of “on demand” uncon-

ditional guarantees ■ Autonomy; the independence principle ■ The types and use of guarantees in trade: ■ Bid

• Advance payment• Performance• Payment

■ Direct guarantees ■ Indirect guarantees ■ Counter guarantees ■ Foreign laws and usage ■ Example guarantees ■ Transferable guarantees; key compliance

risks aspects





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Course Contnet

■ “On demand” bank guarantees; vulnerabili-ty to criminal abuse

■ Structuring guarantees to reduce compli-ance risk exposure

■ An appreciation of URDG 758 ■ Product compliance risk profile

Case study; the delegates will consider the compliance risk aspects of a request to issue a transferable letter of guarantee and the further information required to undertake due diligence. Upon the receipt of additional information the delegates will be required to identify any unusual features and consider the course of action

Payables finance (supply chain finance) ■ What payables finance is and when it is

used ■ Types of payables finance; description, op-

eration and parties:• Pre-shipment payables finance (suppli-

er-led)• Approved payables finance (buyer-led)

■ Product compliance risk profile

COMMODITY FINANCE PRODUCTS ■ What commodity finance is ■ Characteristics of commodity finance ■ Key compliance risk zones :

• Emerging markets/high risk jurisdictions• Commodity traders• Value and existence of goods• Syndicated facilities (due diligence on

other lenders/participants)

Commodity traders ■ Nature and vulnerability to compliance risk

exposure ■ Key compliance risk considerations

Pre-export & pre-payment finance ■ What pre-export and pre-payment finance

is ■ Key compliance risk aspects ■ Deployment of risk mitigation in this high

risk environment ■ Product compliance risk profile

Typology; the use of commodity based pre-payments to disguise the movement of laundered funds

Warehouse financing ■ Description and operation ■ Parties ■ Key compliance risk aspects ■ Deployment of risk mitigation techniques

■ The use and vulnerability of warehouse receipts

■ The role of collateral managers ■ Product compliance risk profile

Tolling ■ What tolling is ■ Parties and operation ■ Compliance risk exposure

Case study; delegates will be required to construct a trade cycle timeline and determine how they can validate, control and manage a cotton commodity finance transaction through each stage of the cycle from a compliance risk perspective

TRADE PRODUCT COMPLIANCE RISK FRAMWORK ■ Trade compliance risk summary ■ Compliance risk profile summary for each

key trade product

Red flags ■ Trade based money laundering ■ Sanctions

Fraud ■ Vulnerability of cross border transactions ■ 10 warning signs to avoid fraud

SUMMARY/CONCLUSION



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Trade Finance SalesIn-House

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Course Overview

Practical workshop on international payment and security instruments with special focus on documentary collections, documentary credits, demand guarantees and short term receivable finance from the sales perspective. The seminar has been developed to address the most important aspects of the trade finance in order to better understand needs of bank customers active in the international trade. In contrast to other seminars on trade finance, the focus on this trade finance sales workshop is to develop knowledge and understanding of the trade finance services in order to sell/offer these services effectively. The scope and the content of the course, consequently, has been tailored to meet this overall goal.To sell trade finance services to the customers effectively, one must: ■ understand how the main trade finance services and products work; ■ what are the overall benefits for their users, ie. bank customers; ■ what are the costs, risks, main practical issues involved and other main aspects which signifi-

cantly influence the bank – customer relationship.

This Workshop has been designed to deal with the most relevant aspects of trade finance sales and is, therefore, a must for: ■ bank relationship managers dealing with exporters, importers and traders; ■ bankers working in trade finance, particularly in documentary payments, bank guarantees and

export/import finance departments, especially those responsible for the business relationship with customers and their support in the area of trade finance;

■ specialists in trade finance with a working experience, back office bank specialists who wish to broaden their knowledge about trade finance from sales/relationship point of view;

■ lawyers, advocates, academics who want to learn about short term trade finance services with focus on their overall operations, benefits for users, costs, risks involved, etc.

The seminar deals with both the standard and more advanced situations and practical issues in relation to export and import documentary collections, documentary credits and their financing, demand guarantees in accordance with best practices as reflected in ICC rules and publications. A part of the workshop will also relate to short term trade finance, ie. factoring, use of credit insurance and will provide an introduction to supply chain finance. Objective of the training: The main purpose of the seminar is to familiarize the participants with the main trade finance products in order to understand how they operate, what are their main benefits for their users, but also what are the main risks involved, associated costs, the main issues the users face in their practice. The participants, after the course, would be able to speak knowledgably with their current and potential customers about the trade finance services their banks provide, thus better supporting the bank´s aspiration to increase the volumes and profits from these services, as well as enhancing the customer´s overall experience of dealing with the bank.

The seminar will be provided in the form of case studies, examples and discussions, i.e. active participation will be encouraged.

Material relevant to the course will be distributed and a certificate of attendance will be delivered to all those who completed the course.

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Course Content

Day OneInternational trade, main issues, payment methods, financing needs International Trade – the main issues and risks to be considered ■ Risks from the Exporter´s perspective ■ Risks from the Importer´s perspective ■ Know Your Customer – his problems might

become your problems as well! ■ Contract of Sale – main aspects to be con-

sidered by the Exporter and the Importer ■ Contract of Sale from the banker´s point of

view ■ Delivery Terms as per Incoterms 2010 –

what do they do? ■ Delivery terms for any mode of transport ■ Delivery terms for marine transport ■ How to choose the right Incoterm? ■ The choice of delivery term from the financ-

ing banker´s point of viewCase Study International Trade – role of documentation ■ Main documents in international trade –

their roles ■ Financial documents, Commercial docu-

ments, Transport documents, Insurance documents – the main aspects to be aware about

■ Bills of Lading v. consignment notes – con-trol over the goods during transit

■ Security interest in the goods in transit from banker´s point of view

International Trade – risk mitigation tools, payment instruments and financing techniques ■ Main payment conditions in international

trade ■ Payment in advance, payment after delivery ■ Documentary Collections and how they op-

erate ■ The benefits for the Exporters and Import-

ers in using Collections ■ Documentary Collections from banker´s

point of view, an opportunity for the cross selling

■ Cost, risks, main mistakes in practice and how to avoid them

■ How to offer Documentary Collections to potential customers?

Case study – Collection in practice ■ Documentary Credits and how they operate ■ The benefits for the Exporters and Import-

ers in using Documentary Credits International Trade – risk mitigation tools, payment instruments and financing techniques ■ Trade Cycle of the Exporter and its financing

needs ■ Trade Cycle of the Importer and its financing

needsCase Study – delivery terms v. payment terms

Day Two

Documentary Credits and their financing, Bank Guarantees, Standbys, Receivable financingDocumentary Credits – How they function – best practices ■ Import Documentary Credit ■ Issuance of the Credit ■ The Application to issue a documentary credit

– main mistakes in practice ■ Import Documentary Credit as payment and

risk mitigation instrument ■ Cost, risks in Import Documentary Credits ■ How to offer Import Documentary Credits to

potential customers?Case study: issuance of the credit

■ Export Documentary Credit ■ Advising, Confirmation ■ Main mistakes in documentary credits from

Exporter´s perspective ■ Cost, risks in Export Documentary Credits ■ How to offer Export Documentary Credits to

potential customers?

Case study: mistakes in the export creditDocumentary Credits – Main financing services

■ Import credit – import financing (import loan v. deferred payment)

■ Export credit – pre-shipment finance – the benefits

■ Red clause, green clause credits, packing, manufacturing credits

■ Export credit – post-shipment finance, negoti-ation, post-financing, forfaiting – the benefits

■ Post financing: how to choose the right tech-nique?

Case study: cost of discounting a deferred payment credit

Use of credit and risk mitigation instruments: Bank Guarantees and Standbys ■ Bank Guarantees v. Conditional guarantees ■ Main types of guarantees, standbys ■ Examples of main types of guarantees

Case study: mistakes in an advance payment guarantee

■ How to offer bank guarantees to potential customers?

Receivable finance ■ Open account trade ■ Credit insurance – main principles from Ex-

porter´s perspective and from the perspective of the financing bank

■ Factoring – how it operates ■ Supply chain finance – main techniques ■ New developments: BPO, digitalization of

trade finance ■ Bank to Customer communication channels:

front end systems, etc. ■ Current main challenges: compliance issues,

new technology developments

Discussion

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Examination Of Documents Under Documentary CreditsIn-House

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Course Overview

Advanced practical workshop on examination of documents under documentary credits, i.e. The most demanding task of the documentary credit practice. The workshop has been developed to provide very comprehensive coverage of the subject. It will explain all main aspects of examination of documents in accordance with ICC Rules – UCP 600 as supplemented by ISBP 745. The most significant recent ICC Banking Commission Opinions and DOCDEX cases will be also covered in the lectures.

The workshop is very focused and practical. Participants will learn how to examine documents mainly by examining them themselves, i.e. There will be plenty of various cases studies, examples, debates on the issues.

This workshop has been designed to provide comprehensive and profound knowledge in relation to examination of documents under documentary credits at advanced level, and is, therefore, a must for: ■ Specialists in trade finance with a working experience, back office bank specialists who need to

broaden their knowledge and understanding of examination of documents as per ICC rules; ■ Bankers working in trade finance, particularly in documentary payments, bank guarantees and

export/import finance departments, especially those providing respective advisory services to the customers.

The workshop deals with both the standard and more advanced situations and practical issues in relation to documentary credits in accordance with best practices as reflected in ICC rules and publications. Participants will learn all relevant main UCP 600 and ISBP 745 provisions in practical manner, i.e. By applying them through various case studies and debates on the subject.

Objective of the training: ■ The main purpose of the seminar is to familiarize the participants with all main aspects of examina-

tion process, standard as well as more advanced situations, problematic issues and current topics in the field of documentary credit practice with particular focus on examination of documents.

■ ■ The workshop will be provided in the form of case studies, examples and discussions, i.e. with ac-

tive participation of all participants. ■ ■ Material relevant to the course will be distributed and a certificate of attendance will be delivered to

all those who completed the course. ■ A good working knowledge and familiarity with documentary credits is required to derive the maxi-

mum benefit from this course.

About the Resource PersonYour course lecturer has spent more than 25 years in international trade finance field. He is a leading international trainer and consultant in the field, well established specialist of the ICC Banking Commission. He has been active in various ICC Banking Commission activities (UCP, URDG revisions, creation of URF – rules for forfaiting, URBPO, etc.). He has lectured extensively on the subjects in more than 50 countries of the world, including the UK, Europe, MENA, Africa and Asia. He is an author of the leading best-selling book on “Examination of Documents under Documentary Credits“.

Course Content

Day 1

Examination of documents under Documentary Credits in Practice ■ Main rules regarding examination of docu-

ments as per UCP 600 and ISBP 745• Relationship between UCP 600 and

ISBP 745• Place and time for presentation as per

UCP 600, article 6• Place and time for presentation as per

L/C terms• Place for presentation and availability

of credits

■ Main standard for examination of documents• No conflict in data, • Illustration of „no conflict in data“princi-

ple, examples, ICC Opinions ■ Main general principles captured in ISBP 745

• Corrections, alternations• Issuers• abbreviations• copies v. originals• language• misspelings, typos• signatures

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Examination Of Documents Under Documentary Credits

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Course Content

Examination of financial documents – part1 ■ examination of bills of exchange, examples,

cases• tenor• endorsements• marking, other conditions

Examination of commercial documents – part 2 ■ Examination of commercial invoice, exam-

ples, cases• description of goods in commercial in-

voice• other aspects to examine

■ examination of packing list, examples, cases

■ examination of weight list, examples, cases ■ examination of commercial documents –

advanced case study

Examination of commercial documents – certificates – part 3 ■ Examination of inspection certificate, ex-

amples, cases ■ Examination of quality certificate, exam-

ples, cases ■ Examination of phytosanitary certificate,

examples, cases ■ Examination of veterinary certificate, ex-

amples, cases ■ Examination of fumigation certificate, ex-

amples, cases ■ Examination of inspection certificate, ex-

amples, cases ■ Examination of certificate of origin, exam-

ples, cases• Description of goods in certificate of

origin• Exporter, consignee• Origin of goods• Issuer, certification by chambre of com-

merce or similar organization• Different types of certificates of origin

■ Examination of certificates – advanced case study

Examination of transport documents – part 4 ■ examination of ocean bill of lading, exam-

ples, cases• on board notations• signatures• negotiable v. straight consigned• clean v. not clean bill of lading

■ examination of charter party bill of lading, examples, cases• specific issues with CP bills of lading:

more ports, transhipment ■ examination sea waybill, examples, cases ■ examination of multimodal transport docu-

ments, examples, cases• on board notations

• signatures• negotiable v. straight consigned• clean v. not clean MTD

■ examination of air waybill, examples, cases• names of airports• signatures

■ examination of road transport document, ex-amples, cases• specific issues with CMR • signatures

■ examination of railway transport document, examples, cases

■ examination of inland waterway transport doc-ument, examples, cases

■ examination of transport documents – ad-vanced case study

Examination of insurance documents – part 5 ■ examination of insurance policy, examples,

cases• issuer• insured, need for endorsement • risk covered • insured amount, currency • date of issuance, no expiry • ther issues with insurance documents

■ examination of insurance certificate, examples, cases

■ examination of insurance documents – ad-vanced case study

Day 2

Examination of documents under Documentary Credits in Practice ■ examination of set of documents including bill

of lading, advanced case study • discussion about found alleged discrepan-

cies

Examination of documents under Documentary Credits in Practice ■ examination of set of documents including air

waybill, advanced case study • discussion about found alleged discrepan-

cies

Examination of documents – more complicated situations ■ examination of documents under transferable

credits – specific issues explained ■ examination of documents under transferable

letter of credit, advanced case study• discussion about found alleged discrepan-

cies

Examination of documents – cases, debates ■ is it a discrepancy or not? – various case stud-

ies, examples ■ questions and answers, discussion about re-

maining issues

http://redcliffetraining.com/training/banking-training-courses/examination-of-documents-under-documentary-credits/


Risk in Trade Finance and Trade Finance Products

In-House

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Course Overview

Trade Finance remains the engine at the heart of global economic growth with China still probably the most important participant. Commodity Finance sits at the heart of this trade dominated by oil and gas which according to some estimates, accounts for as much as 70% of all commodity trade. Global trade is reckoned to be worth $40 trillion and growing.

Trade finance is an interesting risk paradox. It has always been a business area where credit losses are typically very low (mainly fraud in practice), fee income opportunities are high and some of the products are very efficient users of capital. On the other hand it is a very high risk area for Financial Crime. It is estimated that as much as $2trillion is laundered annually, much of it using trade finance. Regulators and law enforcement agencies believe that if it is made as difficult as possible to laun-der money through banks, this could help stifle crime. Banks are expected to do their bit and this is having a significant (but manageable) impact in most banks. With trade typically transiting several countries, with different regulations and different regulatory standards, it is very difficult to manage the risks with precision. This remains a product offering that is watched very closely by regulators and policed ruthlessly (when it comes to sanctions) by OFAC.

There are other general uncertainties overhanging the market. The impact of both Brexit and The Trump presidency are very hard to predict and both the short and medium term outlooks remain un-certain which is not helpful. Most markets are “holding their breath”. Similarly we have just seen the latest “agreement” by OPEC and others (primarily driven by Saudi Arabia) to restrict production and hopefully boost oil prices. Early signs show it is working but will it last?

This practical two day trade finance course is designed for relationship managers and those working in sales or supporting the sales team together with colleagues from credit department, responsible for approving trade finance propositions. It concentrates on risk identification and mitigation as well as how to explain the wide range of the Bank’s Trade finance services. It focuses particularly on risk assessment, delivery, need identification, and selling opportunities. The course encourages delegates to see issues from both the client’s and the bank’s relationship manager’s viewpoint.

The aim is to provide high quality trade finance services to the bank’s clients in a seamless and helpful manner and to assist delegates understanding of the trade flows and the precise nature of the bank-ing risks undertaken.

The course will also demonstrate the self-liquidating short term nature of most trade transactions. A clearer understanding of the actual banking risks should mean profitable business and earnings opportunities will arise as a natural consequence. The course encourages trade finance specialists to become user friendly general practitioners, rather than specialist custodians of knowledge, which can sometimes be the case from the client’s viewpoint. All clients want value for money services. This course aims to encourage delegates to deliver it.

Your FacilitatorHas over 40 years in the banking and trade finance sectors. His career was spent initially with Lloyds Bank plc and then as a main board director of a specialist London based merchant bank. He has de-livered numerous successful public courses on this topic as well as in house trade and commodity financing programmes at an advanced level for Bank of China, HSBC, Royal Bank of Scotland Group, Lloyds TSB, Commerzbank, Garanti Bank as well as all the leading South African and Nigerian Banks

He is an approved external master trainer for the world’s largest trade finance bank and has trained extensively in the UK, USA, Europe, Scandinavia, Africa, Asia and the Middle East.

Methodology:The course will be run as a workshop style classroom session, with detailed examples. Delegates are free to bring their own cases/examples to the sessions.

Level of PreparednessBeginners are welcome although a very basic working knowledge and understanding of the methods of financing International Trade would be helpful.

http://redcliffetraining.com/training/banking-training-courses/risk-management-in-trade-finance-course/


Risk in Trade Finance and Trade Finance ProductsContinued

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Course Content

Trade Finance Overview ■ Historical evolution and current develop-

ments in the market place ■ Principles of trade Finance ■ Parties to a transaction ■ Roles, obligations, interests ■ Typical users of Trade Finance products and

services ■ Payment mechanisms ■ Trends – Migration to open account ■ Risk Ladder and review of traditional trade

products

Risk – The Critical Issues ■ Understanding, identifying and managing

risk ■ Risk ladder and trade products ■ Sovereign, Political / Country risk ■ Institutional risk / Bank risk ■ Corporate and other critical risks ■ Importer and Exporter’s risk – delivery,

quality, payment etc ■ Risk mitigation, management and transfer ■ Risk migration versus commercial necessity ■ Managing risk within open account trade

Case Study – the impact of risk on trade – the often differing bank & client’s perspectives

Review of Key Products ■ The challenge to banks of disintermediation ■ How does your customer analyse his risk? ■ Which products does he use and why? ■ Cash in Advance - summary ■ Open Account – summary - the biggest risk

challenge for seller and the bank ■ Collections – summary - Outward & Inward

/ Clean & Documentary ■ Letters of Credit - summary - (covered in

detail below), import and export ■ Risks and opportunities – bank versus client

perceptions ■ Marketing possibilities and opportunities

Case Study – how does your client choose to trade – what would you prefer?

Regulatory and Trade Conventions and Their Role in Risk Migration: ■ Incoterms - the list, Incoterms the impact,

UCP 600, URC, URDG

Risks inherent in Payment in Advance: ■ Definition and explanation ■ Risks ■ Mitigation techniques, Migration techniques

■ Risk/reward consideration ■ Commercial tug of war ■ Avoiding unhelpful retrospective advice

Case Study – How can the bank assist when there is no obvious role?Risks inherent in Open Account Trading: ■ Definition and explanation ■ Risks ■ Mitigation techniques, Migration techniques ■ Risk/reward consideration ■ Commercial tug of war ■ Granting buyer/supplier credit ■ Why is it any different to domestic trade

Case Study - how do we fund this client preferred method of trade?

Risks Inherent in Collections - Clean & Documentary: ■ Definition and explanation ■ Risks ■ Mitigation techniques, Migration techniques ■ Risk/reward consideration ■ Commercial tug of war ■ Granting buyer/supplier credit ■ What is the real point of a clean collection

Case Study – Imports are easier to fund using collections than exports – discuss?

Risks Inherent in Letters of Credit: ■ Definition and explanation ■ Risks ■ Mitigation techniques, Migration techniques ■ Risk/reward consideration ■ Commercial tug of war ■ Do we need 100% security cover? When and

if will this be relaxed

Letters of Credit (L/Cs) - Additional Mechanisms: ■ Transferable L/Cs, Revolving L/Cs, Evergreen

L/Cs, Standby L/Cs, Back to back structures (brief intro), L/C & Bill Discounting, Avalised bills

Case Study – This is by far the easiest and safest trade instrument for clients and the banks. With the exception of Standby L/C’s why do conventional L/C’s account for less than 10% of all trade?

Introduction to the Regulatory Approach to Trade Financing ■ Transformation of the regulatory environment ■ Basel Accords and impact on banks activities ■ Credit Risk, Market Risk, Operational Risk



Risk in Trade Finance and Trade Finance ProductsContinued

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Course Content

■ Other Regulatory Risks

Case Study – Why do we have a “target RORAC”? Can you explain it to a client?

Financing & Managing Import Trade Risks in Challenging Markets ■ The value chain – bank perspective versus

client perspective ■ Structured vs. traditional trade finance ■ Risk analysis of a trade import deal look-

ing at ■ Credit risks, Product risks, Transactional

risks, Price risks, Performance risks

Case study example – consider a hypothetical case

STF – Risk Management in Financing Export STF ■ Prepayment ■ Pre-export ■ Pre shipment ■ Post shipment ■ When do sales actually become debtors ■ The reality of title and control

Case Study – L/C backed STF is easy to fund. How do we handle Open Account?

Risk Assessment For Credit Analysis and Application Purposes: ■ Analysing the trade flows ■ Break even analysis ■ Assessing facility size and structure ■ Identifying and mitigating the risks ■ Gearing, repayment, profitability and

liquidity. ■ Specific lending with identifiable maturity

dates ■ Appreciating and controlling sources of

repayment ■ Security – Is the last resort in practice

despite CCCPARTS

Case Study - How can we re-learn short term TF skills and trade cycles and move away from the omnibus overdraft?

Effective Use of Collections for Short-Term Finance ■ Using collections as financing opportunities ■ Identifying and mitigating risks ■ Maintaining control

Case Study – example

Introduction to International Demand and Contract Guarantees / Bonds ■ URDG758, Scope and Application – an intro-

duction ■ Different types - Bid, Performance, Advance

payment , Warranty and Retention bonds ■ Risk Migration – the challenge of unexpired

bonds/guarantees ■ Opportunity spotting ■ Standby L/C’s (SBLCs) as Risk mitigators

Case Study – a construction client’s needs

Receivables Financing and Risk Migration ■ Mechanics of Securitisation ■ Factoring and Reverse Factoring ■ Mechanics of Factoring and Invoice Dis-

counting ■ Role of Credit Insurance

Case study – exampleIntroduction To Innovations In Risk Management and Migration ■ Silent confirmations ■ Silent Payment Guarantees ■ CTN options ■ Purchase and sales ledger options ■ Bank Assisted Open Account ■ Securitising funds flows, future flows, re-

ceivables and inventories

Case study – How to use these techniques to establish a base relationship with a target client

Advisory Services ■ Core offerings ■ Trade intelligence ■ Payments & collections ■ Trouble shooting ■ Progress chasing ■ Translation and exposure risks ■ Counter party risks ■ Export & import specialist advice ■ Credit insurance ■ Other services

Introduction to ECA’s – Risk Transfer From the Bank to insurance Sector ■ Credit Insurance ■ Political Risk Insurances ■ ECA structures ■ Intermediation by ECA’s ■ UK Government Schemes



Course Content

Trade Finance for LawyersIn House

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Course Overview

This one day seminar, aimed at lawyers and non-bankers, provides and insight into trade finance practices and related risks.

After attending the course participants will be able to explain to their clients the benefits of using Incoterms, as well as detail the different methods of providing finance and their key characteristics.

They will also be able to assist with identifying and structuring the appropriate trade solutions for customers, assess various risks to both the bank and the client in international trade transactions and explain and identify ways of mitigating that risk.

Incoterms 2010: ■ The purpose of Incoterms ■ The 11 Incoterms ■ How Incoterms affect the documents that

exporters must produce

Key characteristics of Commercial & Financial Documents ■ Invoices ■ Transport Documents ■ Insurance Policy/Certificate ■ Understanding the use of Bills of Ex-

change and Promissory Notes

Documentary Collections ■ Parties and responsibilities ■ Uniform Rules for Collection 522

Introduction to UCP 600 ■ Purpose ■ Structure ■ Articles

Instructions to issue/amend Letters of Credit ■ The importance of the application form

(legal issues) ■ Workability of the credit

Examination of documents ■ International Standard Banking Practice

ISBP 681 ■ Key elements of the main articles of UCP

600 ■ Processing non-compliant documents as

issuing bank ■ Processing non-compliant documents as

Nominated/Confirming Bank ■ Risks arising from non-adherence to UCP

600 & ISBP 681

Related issues ■ Assignment of Proceeds under Letters of

Credit

Specialised Letters or Credit ■ Transferable ■ Back-to-Back ■ Red Clause Credits ■ Revolving & Reinstatement Credits ■ Evergreen Credits ■ Standby

Contract Guarantees ■ Types ■ Risks ■ Security ■ URDG 758

http://redcliffetraining.com/training/corporate-finance-and-banking-training-legal-courses/trade-finance-for-lawyers/


Course Content



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Course Overview


In-House

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Course Overview

This practical workshop style course is designed for relationship managers and those working in sales or supporting the sales team together with colleagues from credit department, responsible for approving finance propositions.

Invoice discounting is a significant form of corporate finance widely used by small and medium sized businesses, often alongside other asset based lending such as stock finance, hire purchase, term loans and trade finance. This course is designed to give practitioners an understanding of the peculiarities of this particular form of financing relationship, the problems which commonly arise during the recovery process and practical guidance on how to deal with risk identification and mitigation.

The training can be structured to focus particularly on risk assessment, delivery, need identification, and selling opportunities. The course encourages delegates to see issues from both the client’s and the bank’s relationship manager’s viewpoint.

The aim is to provide high quality invoice discounting to the bank’s clients in a seamless and helpful manner and to assist delegates understanding of the trade flows and the precise nature of the banking risks undertaken. The course will also demonstrate the self liquidating short term nature of most trade transactions.

Methodology:The course will be run as a workshop style classroom session, with detailed examples. Delegates are free to bring their own cases/examples to the sessions.

Level of PreparednessBeginners are welcome although a very basic working knowledge and understanding of the methods of financing domestic and International Trade would be helpful.

Course Content

Module 1: The Working Capital Cycle

■ The working capital cycle ■ Overtrading ■ A simple cash flow exercise to illustrate the

potential problems ■ Different types of working capital ■ When and how should a bank assist its

customers ■ When should the bank decline

Exercise: Working capital analysis

Module 2: Invoice discounting basics:

■ What is it? ■ The growth of invoice finance ■ Changes following Re Spectrum Plus Ltd ■ Invoice finance distinguished from lending

on security

■ The various forms of invoice finance ■ Notification and non-notification financing

(confidential versus disclosed) ■ General Risks ■ General Mitigation techniques

Exercise Case study to suit

Module 3: Setting up the Service:

■ Creating a product guidance manual ■ Setting operational parameters ■ The structure of the invoice finance agree-

ment ■ The purpose of the power of attorney grant-

ed, if used ■ The transfer of rights ancillary to the debt ■ Challenges to administration charges as pen-

alty clauses ■ The implications of Peekay Intermark


Invoice Discounting (Domestic & International)A Two Day Workshop Style Course


http://redcliffetraining.com/training/banking-training-courses/invoice-discounting/

http://redcliffetraining.com/training/banking-training-courses/invoice-discounting-domestic-international-two-day-workshop-style-course/


Course Content



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Course Overview



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Course Content

Module 4: Invoice Discounting in Practice

■ Minimum/maximum size ■ Minimum/Maximum client turnover ■ Percentage advanced ■ Individual invoices or a portfolio spread ■ Secured or unsecured ■ Commercial invoices only? ■ Collection time frame – what is a normal

time-scale ■ Issues Arising out of the Assignment of

Debts ■ The importance of a legal rather than equi-

table assignment ■ Vesting debts - when does the debt arise? ■ Non-vesting debts and the prohibition

against assignment ■ The effect of notice to the debtor, if any


Module 5: Early Engagement of Financial Crime Compliance (and sanctions if overseas transactions involved):

■ FCC risks ■ Sanctions risks ■ Screening ■ Inherent risks ■ Mitigants ■ Residual risks ■ CDD, EDD, Discrete DD, KYCBCBC…. ■ Approving individual invoices versus whole

sales ledger ■ Setting operational parameters ■ The structure of the invoice finance agree-

ment


Module 6: initial Client Assessment for Product Suitability:

■ Guidelines ■ Procedural instructions ■ New versus existing customers ■ Sales ledger review – if applicable ■ Limit setting ■ Approvals – blanket and specific ■ Risk assessment outcome ■ Annual review or individual transactions


Module 7: Risk Assessment for Credit Analysis and Application Purposes:

■ Creating procedural guidelines ■ Setting parameters ■ Analysing the working capital flows ■ Break even analysis ■ Double funding risks ■ Assessing facility size and structure ■ Identifying and mitigating the risks ■ Gearing, repayment, profitability and liquidity. ■ Specific lending with identifiable maturity

dates ■ Appreciating and controlling sources of repay-

ment ■ Security – Is the last resort in practice despite

CCCPARTS


Module 8: Fraud & Conflicts with third parties:

■ The distinction between warranties, guaran-tees, indemnities and hybrids securities

■ Conflicts with third parties, including priority disputes with competing assignees

■ Fraud and Asset Recovery ■ Classic frauds faced by invoice financiers ■ Proving damage: GE Commercial Finance v

Gee ■ The meaning and effect of the trust provisions ■ When to rely upon the remedies of dishonest

assistance and knowing receipt ■ Proprietary remedies and tracing in insolvency ■ Freezing injunctions and search orders ■ Mitigation techniques


Module 9: Financing & Managing Trade Risks in Challenging Markets

■ The value chain – bank perspective versus client perspective

■ Structured vs. traditional trade finance ■ Risk analysis of a trade import deal looking at

• Credit risks• Product risks• Transactional risks





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Course Overview



Continued

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Course Content

• Price risks• Performance risks


Module 10: Charges and Fees

■ Structure and application ■ Individual fees or flat percentage charge ■ Fees and interest ■ Recourse options

Module 11: Managing the Product

■ Manual process ■ Automated process ■ Audit process ■ Roles and responsibilities ■ Fees and interest ■ Recourse options


Module 12: What to do When it Goes Wrong

■ A rare event – usually ■ KPI’s and KRI’s ■ Warning signs ■ When to intervene ■ Who actually enforces the invoice ■ Recourse agreements in practice – espe-

cially with valuable clients ■ Recovery procedures ■ Enforcing security


Course Conclusion and Review / Feedback




The specialist in highly technical, market-driven banking and corporate finance training

web: redliffetraining.com email: [email protected] phone: +44 (0)20 7387 4484