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TRADE FINANCE KNOWLEDGE 20 AUGUST 2010 By Kreingkrai Kerdkrokeo Vice President, International Banking Department.

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Presentation on theme: "TRADE FINANCE KNOWLEDGE 20 AUGUST 2010 By Kreingkrai Kerdkrokeo Vice President, International Banking Department."— Presentation transcript:

1 TRADE FINANCE KNOWLEDGE 20 AUGUST 2010 By Kreingkrai Kerdkrokeo Vice President, International Banking Department

2 International Trade Buyer/Seller  Sales Contract  (Purchase Order/Quotation/Proforma Invoice)  Carriage Contract  (Exporter/Shipper --- Carrier/Forwarding Agent)  Banking Operation  Visible Trade : Import/Export  Invisible Trade : Inward/Outward

3 3 Exporter, Seller, Beneficiary Importer, Buyer, Applicant Buyer Port Seller Port Goods THAILAND JAPA N Advising, Confirming, Negotiating Bank Issuing, Opening. Paying Bank Paying Bank Reimbursing Bank Opening L/C Docume nts Money Request to Open L/C Sale Contract, Purchase Order, Proforma Invoice Advise L/C Docume nts Mone y Docume nts Mone y 3.Authority to Pay 7. Claim 10. Money * Open L/C * T/R, S/G * Advise L/C * Transfer L/C * Confirm L/C * P/C * B/P, * B/D * Fund transfer * FX Nostro Bank

4 Risks of L/C Issuance/Amendment  Full set of original B/L not required by L/C  Consignee of B/L not to be SME Bank  Full set of original Insurance Policy/Certificate not required by L/C Risk of International Trade Finance

5 Risks of Documents  Refusal payment under discrepancy(ies) Risks of Trust Receipt (T/R)  Insufficient customer’s cash flow  Exchange rate fluctuations Risk of International Trade Finance

6 Risks of Packing Credit under L/C  L/C not hold by Bank Risks of Packing Credit under Sales Contract  Goods not shipped Risk of International Trade Finance

7 Risks of Bill Purchase under L/C  Issuing Bank refuse to pay under discrepancy(ies) Risks of Bill Purchase under Sales Contract  Buyer refuse to pay under any reasons Risk of International Trade Finance

8 (Export) (Import) (Remittance) (SWIFT) (International Relation) International Department

9 Export  Pre-shipment – Packing Credit (80% of L/C Amount & 70% of Sales Contract)  Post-shipment – Bill Purchase (100% of L/C Amount & Sales Contract) Import  Opening L/C / Trust Receipt Inward & Outward Remittance Trade Finance Banking Facilities

10 Product Export Interest  Packing Credit  Short Term Loan not over 180 Days  Borrowing Loan not over 80% of L/C or not over 70% of Trade Volume /Order  Bill Purchased against Sight L/C or Bill Discounted against Usance L/C  Bill Purchased against B/C or Bill Discounted against Usance B/C

11 Product Export Fee  Export Bills Drawn under L/C  Export Bills for Collection  Export L/C Advising

12 Product Import Fee  L/C, DL/C Service (Import L/C Issuance)  Shipping Guarantee  Import Bills for Collection

13 Product Import Interest  Trust Receipt  Short Term Credit not over 180 days

14 Remittance Service - -Outward Remittance - -Inward Remittance - ** Thai Kitchen to the world SME Bank USD : Wachovia Bank N.A. New York JPY : The Bank of Tokyo-Mitsubishi UFJ Ltd. Tokyo EUR : Deutsche Bank A.G. Frankfurt  Nostro Account : Foreign Exchange Account which SME BANK opened with the other banks for operating in foreign Account

15 Working Procedure Call Visit Business Center Head Office International Banking Team Mortgage Sign Contract by Credit Processing Department Analyze Approve Inform loan approval amount to International Banking Department for preparing the document International Banking Department coordinate with customer for requesting the document for open L/C, T/R, P/C Staff of Branch / Head Office note for Loan Disbursement International Banking operate as loan disbursement procedure and save in Approval Loan System of Department Set up for Loan Approval Loan Disbursement Credit Processing Department operate in Loan Disbursement (incase of P/C)

16 1. Service of International Banking Department  How long have to wait if the customer bring the application form for open L/C ?  How many days will receive the money if the customer bring the export documents to the bank ? 2. Which information is necessary for Credit Analysis ? 3. What is the credit guarantee of International Banking Credit ? 4. Does the bank has the strong point in international trade finance and How ? Frequent Asking Questions

17 Mr.Kriengkrai Kerdkoekeo Tel Mobile Mr.Chatri Wetsoranasutee Tel Mobile Ms.Pensri Suanarunsawat Tel Ms.Renuka Makthiengtrong Tel Mobile Mr. Nopporn Piyapanuwat Tel Contact

18 Thank You


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