International Trade Finance Training Course

A cutting-edge and highly practical three-day course that explores all the main risks in contemporary trade finance products and structures.

This course opens up the communication channels between credit managers and trade finance managers in a highly practical manner.

In three intensive days, this course confronts the current issues in international trade finance on a step-by-step basis.  It will lead you through a thorough understanding of the risks and solutions involved.  You will return to work fully aware of the best risk mitigation and internal communication techniques, ready to do business in a safe and prudent manner.

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Day 1

Letters of Credit and their Variants

The Evolution of Letters of Credit in the Trade Cycle

• Collections and international documentation
• Payment, acceptance and negotiation modes of funding
• A closer look at negotiation under new ICC 600 rules
• Deferred payment letters of credit
• Case Study: Who takes the main risk? An L/C is put under the risk spotlight to highlight the risk stances of applicant (buyer), beneficiary (seller), issuing bank and intermediary paying or negotiating banks
• Confirmations silent/straight and soft
• Red clause L/Cs their mechanics and risks
• The utilisation of non-operative clauses as a risk mitigation technique
• Deferred payment L/Cs in oil trading
• High risk countries and the red clause transferable bulk L/C

Group Workshop 1: The ICC 600 In-Tray Exercises
Delegates, armed only with a copy of the UCP ICC 600, solve international documentation and discrepancy issues.

Back To Back Issues

• The mechanics of back to back letters of credit
• Case studies in back to back financing
• Securities and pitfalls
• Long horn back to backs
• Counter L/Cs
• Back to back variations

Group Workshop 2:
Delegates in groups utilise L/Cs and guarantees to structure a workable solution for a client in an emerging market country buying an oil by-product.

Group Workshop 3:
Reading material for tripartite oil for coffee "back to back" style financing. this is overnight reading material for a structured, multi-country and multi-commodity L/C based deal where the delegates, in groups will be asked to highlight the main risks and risk mitigation techniques.

DAY 2

The Essential Differences Between Guarantees and Standby L/Cs

• Guarantees in trade finance
• Case studies and examples of performance bonds, bid bonds, retention money guarantees and advanced payment guarantees
• The mechanics of standby contemporary issues
• Case study: Defining the products by example
• THE HYBRID: A practical case study reviewing the risks inherent in the conditional guarantee and standby being utilised as payment mechanisms

Forfaiting and Factoring

• Single receivable forfaiting market
• Mechanics of forfaiting
• The political risk reality of forfaiting
• Forfaiting deferred payment L/Cs
• Contemporary models
• Forfaiting and factoring compared
• Forfaiting interest calculations
• Jumbo L/C risk sharing, sales and distribution
• Structured single export

Group Workshop 4: Bondtrade
Delegates evaluate the risk and present their findings

Group Workshop 5: Product Innovation, Making the Market
Delegates in groups solve the problem of an International-Contract based deal between two majors who do not wish to utilise Letters of Credit but DO seek their bank to confirm a payment undertaking by drafting and selling a simple payment agreement.

DAY 3

Group Workshop 6: The Internal Presentation
Presenting transactional deals to credit committees looking towards balance sheets for traditional assessment has been one of the communication problems besetting the industry. This core group workshop critically analyses a deal, mitigates risks and produces the first, Microsoft Excel solution to the problem clearly indicating in one page all the issues of bank and country line utilisation and risk garaging techniques to ensure that delegates get more deals through credit committee whilst protecting themselves and the bank's risk position.

Warehouse Financing and Fraud Avoidance

• Contemporary warehouse financing techniques and risks
• Warehouse receipt/warrant financing
• Demonstration of political risk impact on prefinance and insuring off-take prices
• Fraud avoidance techniques. How NOT to lose $300million in one day!
• Due diligence with banks' securities
• Middle office functions
• What to do if things do start to go wrong!
• Spotting and avoiding fraud in trade finance: 5 generic case studies

Structured Pre-export Finance

• The fundamental principles of "tolling" finance deals
• Case studies in securitisation and pre-export finance structures
• Timing and an introduction to option financing

 De-Brief: Question and answer session and a look at the future via Energy Structured Export Notes.

After three intensive days you will have a full working knowledge of:

• A payment, negotiation, acceptance, confirmation and deferred payment credits
• The UCP-ICC 600 rules
• International documentation
• Standbys and international guarantees
• Back to back, front to back and event-triggered finance
• The mechanics of discounting, forfaiting and factoring
• Pre-shipment and pre-export risk assessment
• International contract financing
• Marketing trade finance – internal and external