"> The Latest Trade Financing Trends or Products Offered by Banks | exportacademy.net

The Latest Trade Financing Trends or Products Offered by Banks

Date: 20 & 21 April 2020 (Monday & Tuesday)
Time: 9.00am to 5.00pm
Venue: Sunway Putra Hotel, Kuala Lumpur

COURSE OBJECTIVE & TAKEAWAY

Upon completion of this Module, participants will be able to:

  • Explain the scope, perimeters & benefits of these latest Trade financing trends, including the due diligence and the products’ risks profiling required as conditions precedent.
  • Know the “secret punch points”, appropriate packaging and the target customers to market and sell these latest non-traditional trade financing instruments and options.
  • Evaluate the potential trade bills business, FX, fee and interest income that can derived from “Supply Chain Financing”, “Avalised” Bills of Exchange, Promissory Notes” financing plus Cross-Border and Counter Trade financing.
  • Use documentation, controls, face-to-face meetings and conditions precedent to contain the inherent risks and credit exposures relating to these latest trade financing trends, including for 3rd Country and 3rd Party shipments.
  • Understand the roles and responsibilities of the Trade Finance Dept, Risk Management Dept and the Relationship Managers when preparing Credit Papers for Management approval.
  • Acquire the necessary skills and competencies to formulate marketing strategies and action steps to promote and sell these latest Trade financing trends.
  • METHODOLOGY

    Lectures and case studies

    TARGET PARTICIPANT

  • All Credit & Relationship Officers and Managers
  • Branch Sales, Branch Credit Officers and Branch Managers
  • All Business Development & Origination Units
  • Trade Sales & Cash Management Sales officers
  • Regional Centres’ Officers & Managers
  • Risk Management & Compliance Officers & Managers
  • Investment Banking Sales & Marketing Officers & Managers
  • COURSE OUTLINE
    Title
    INTRODUCTION TO THE LATEST TRADE FINANCING TRENDS

    There is a growing trend by Banks to provide these latest Trade financing options for comparative advantage and to create a market niche for themselves. The trade financing landscape worldwide has changed. These non-traditional Trade financing instruments are Multi-currency denominated. The conditions precedent, operational controls and documentary requirements to contain and mitigate the inherent risks will be emphasized and deliberated.
    INVOICE DISCOUNTING

    The objective of offering Invoice discounting to customers is to provide an alternative trade financing mechanism to cater for Open Account trading and transactions that do not qualify for other means of financing (eg. Bill Purchased). Bills of Exchange or Promissory Notes will be used to facilitate Invoice discounting and to serve as legal instruments of demand. However, Invoice discounting may be subject to misuse and abuse and as such, due diligence checking, appropriate documentation and proper controls are required to safeguard the Bank’s interest.
    VENDORS FINANCING

    The wonders and financing concepts related to Vendors Financing will be explained together with the income sharing and risk allocation agreements. The financing structures and income treatment will be highlighted and explained together with the controls and due diligence required to contain the inherent risks associated with Vendors financing. The mechanics and financing principles are “quite similar” to Supply Chain financing.
    TRADE SUPPLY CHAIN FINANCING

    Supply Chain Financing and Management is the most recent trend in financing both International and Domestic trade. Facilitator will explain the difference between Supply Chain Financing or Reverse Factoring and Accounts Receivables Financing and the roles the Banks play in enhancing customers’ working capital and cash flow. The roles and responsibilities of the parties in the Supply Chain Financing transactions will be illustrated. Facilitator will also highlight the potential income, business and marketing opportunities that will be generated.
    FINANCING COUNTER TRADE

    The objectives, principles, financing variations and mutual agreements embedded in Counter Trade will be extensively discussed, together with the features and benefits derived from each type of Counter Trade. The functions and responsibilities of the parties involved in such Counter Trade deals will be spelt out in legal Agreements and supporting documents. Majority of Counter trade deals involved Government to Government parties and are highly structured. Income derived from financing Counter Trade is good because there is no benchmark pricing.
    FINANCING AVALISED BILLS OF EXCHANGE AND PROMISSORY NOTES

    The definition and origin of “avalisation” will be shared by Facilitator together with the scope and perimeters of financing “avalised” Bills of Exchange and Promissory Notes. The controls and documentary requirements under an “avalisation” arrangement must be strictly observed to mitigate the associated risks. The income, spin-off business and volume of business that can be generated are different from other Trade financing products. However, Banks are only offering such financing selectively, as they have to bear bank, country and regulatory risks.
    PURPOSE & SECRETS OF MERCHANTING TRADE

    The characteristics, pricing and terms of engagement when offering Merchanting Trade financing will be explained and discussed in details, together with the inherent risks and controls to protect the Bank’s security interest. Most Merchanting trade transactions involve subsidiaries, Group companies and associates. Trade-Based Money laundering, transfer pricing, siphoning of funds, etc may be perpetuated by customers and/or trading partners.
    EXPORT LC CONFIRMATION & NEGOTIATION BUSINESS

    Export LC confirmations with subsequent negotiations are offered by Banks on an on-going basis. Recently, this trend has gained more traction and popularity. The risk profile of trading parties, banks and countries has changed dramatically due to the current worldwide economic situation. Most Banks’ risk appetite and business focus seem to have revived in this Business . Income and business potentials from this business will be illustrated and discussed, together with the controls and due diligence to take to protect the Bank’s interest.
    CROSS-BORDER FINANCING

    Currently, there is a spike in demand for Cross Border financing in foreign currencies, taking advantage of interest differentials between the borrowing and financing countries. Currency depreciation and weak economic conditions have encouraged Customers to pursue such trade financing arrangements. The financing of imports and exports by overseas Financial Institutions will be explained and discussed in details. Since these are “off-balance items”, the documentation, financing arrangements, controls and booking of loans overseas must be stringent, air-tight and complete.
    CASE STUDY

    Negotiating LCs With Cross Border Financing Arrangements

    TRAINER’S PROFILE

    Jimmy Phua’s last employment was as the Trade Advisor (Vice President) with OCBC Bank Malaysia Bhd. He played an active advisory role on all aspects of OCBC Bank’s import and export Trade operations and Trade financing instruments. His job functions included the review and re-engineering of the Bank’s Trade Operations and Processes, besides training staff (including pipeline interns) on all trade financing products and services. Jimmy was also instrumental in the Bank’s introduction of new Trade products and services.

    Jimmy started his banking career with Malayan Banking Berhad as a new Graduate Trainee before moving to The Chase Manhattan Bank N.A (now JP Morgan Chase) to head Trade Finance and Services (Assistant Vice-President). Positions which Jimmy had held before joining this major Singapore Bank were: Trade Advisor for AmBank (M) Berhad, Trade Advisor for EXIM Bank Malaysia Berhad, General Manager of Trade Finance for Alliance Bank Malaysia Berhad, Vice-President and Head of Trade Services for Deutsche Bank (M) Berhad and Assistant General Manager and Head of International Trade Finance for Kwong Yik Bank Berhad (now RHB Bank ).

    Altogether, Jimmy has more than 30 years of Trade Banking experience, where he had specific responsibilities for Trade Finance operations and marketing, structuring of Trade Finance deals, conducting in-house training programs and workshops for staff and customers and the Banks’ trade fee and interest income targets and KPIs. He has also conducted numerous seminars on Malaysia’s Trade Financing products, Letters of Credit, Bank Guarantees and Auditing Trade Finance for Institute of Banks in Malaysia, Bank Negara Malaysia, local banks, ICC Malaysia and Management Training Companies. Jimmy was a member of EXIM Bank’s Export Credit Refinancing Working Committee, Bank Negara Malaysia’s New Trade Products Working Committees and ICC Malaysia Banking Committee and Task Group.

    He has been invited to present specific product and industry papers on Trade Financing products and services in several Trade Conferences. Jimmy is currently being engaged as a Trade Advisor by a Trade System Development Company, since June 2018 and on-going, to provide his inputs, guidance and experience in the development of an in-house Trade Finance System for a “Special-Purpose Government Bank”.

    COURSE FEES

    Early bird fee: RM1, 590 per person - 13 April 2020

    Normal price: RM1, 855 per person – SBL Claimable (includes Lunch, Tea-Breaks, Course Notes, Certificate of Completion and 6% SST)

    *Group discount of 10% available (for 3 or more participants from the same company)

    ORGANISER

    Malaysian Export Academy
    No. 86, Jalan BP 7/8,
    Bandar Bukit Puchong,
    47120 Puchong, Selangor.

    Tel : 03 8066 3107
    Fax: 03 8066 6152

    MARKETED BY

    Asif International (M) Sdn Bhd
    19-2, Jalan Puteri 2/7
    Bandar Puteri
    47100 Puchong, Selangor

    Tel: 03 8066 3107
    Contact Person : Mohamed Ali Jinnah
    Email : mexportacademy2012@gmail.com

    Subscribe to our Newsletter