OVERVIEW
About This Programme
There are various definitions to be found online as to what trade finance is, and the choice of words used is interesting. It is described both as a ‘science’ and as ‘an imprecise term covering a number of different activities. As is the nature of these things, both are accurate. In one form it is quite a precise science managing the capital required for international trade to flow. Yet within this science, there is a wide range of tools at the financiers’ disposal, all of which determine how cash, credit, investments, and other assets can be utilised for trade.
Approved under the IBF-FTS scheme for career growth
Master best practices for handling trade exceptions in real-world scenarios
Understand trading systems and manage trade risks effectively
what to expect
Course Outline & Learning Outcomes
Course Outline
1. Introduction to Trade Finance
- Evolution, Role in Economy, Global Market Overview, Post COVID-19 Scenario
- What is the role of commercial banks in trade finance?
- What to expect from banks: Know Your Customer, Due Diligence, Transaction Monitoring
- Types of Import and Export Finance – Pre shipment & Post shipment Running account Packing Credit – Clarifications & Bottlenecks
2. Incoterms® rules 2020
- Role / Risk & Responsibilities of Importer & Exporter while using INCOTERMS
- Usage of appropriate INCOTERMS – Risks of making an error on the PO/Invoice
- Key differences to Incoterms® 2010
- Examination of the most used Incoterms®
- Importance of Incoterms® from a trade financing perspective
3. Letter of Credit and Bank Guarantees Process
- Comprehensive discussion on the LC Mechanism
- Understanding the commonly used Types and forms of LCs
- Documentation under LC transactions- Relevance of UCP 600
- What constitute Discrepancies –How to deal with Discrepancies
- Risks to be addressed during an LC transaction
- Discussion on practical problems faced by member companies while handling various LC transactions across the world
- Process of letter of credit
- Understanding of the entire Bank Guarantee mechanism
- Relevance to Onerous Clauses & Open-ended clauses
- Discussion on actual problems faced by companies while handling a BG transaction
4. Import and Export Documentation
- Concepts – Exports, Export Documents, Imports, Import Documents
- Financial Documents, Transport Documents, Regulatory Documents and Commercial Documents. Pre & post shipment Procedure and Documentation
- Customs Procedures
- Procedures & Submission of Documents to Banks
- Trade documentation: Bill of lading, Airway bill, Insurance certificate/ policy, Packing list, irrevocable letter of credit, application of letter of credit, pre-shipment inspection, LOC structure
5. Working Capital and Structured Financing
- Structured finance uses, types, benefits and parties involved
- Credit Assessments: 5 C’s
- Understanding the nature of debt and implications.
- Understanding the documents and risks involved.
- Bill of exchange and promissory note (examples)
- Recourse and re-purchase events
- Types of receivables finance and differences: Specific debt purchase: insured and uninsured, Factoring, invoice discounting.
- Role of an ECA, ECA support
- Commodity trade finance: Types of commodity financing
- Understanding and Constructing a operating / trade cycle timeline to evaluate type, amount and duration of trade finance from company’s perspective
6. Risks involved
- Pre-export and prepayment
- Risk appreciation and mitigation
- Appreciate the financing structures and risk management in structured commodity finance
- Risk in Trade and Collections and New Trends
- Identifying and managing trade risk
- Financial: buyer credit risk, country, and transfer risk
- Political risk: contract and/or payment frustration
- Commercial risk: debt instrument, method of payment, commercial terms, sales leverage
- Performance: supply chain, nature of goods, delivery, dispute
- Documentary: trade instrument performance, export and import clearance
- Legal risk: impact on ICC rules, trade products, security over goods, debt recovery
7. Cross Border Trade Finance: Risk hedging
- Significance of SWOT and country analysis while exploring International Markets
- World’s top banks’ best practices for risk management in Trade Finance
- Financial Crime Risks- Case Studies, Trade Finance Fraud Case studies
8. Digital Trade Finance / Fintechs / Blockchain
- Feedback and Assessment Quiz
Learning Objectives
- Understand the reasons why transaction risks occur
- Gain insight into the processes and systems for trading
- Learn how to measure the financial impacts from risk
- Review best practices for identifying & treating trade exceptions
- Build a performance & risk framework for transaction risk
- Templates built to assess transaction risk control performance
- Calculations and models for measuring risk are investigated
- New regulations are explained & translated to requirements
- Review and capture Key Risk / Performance Indicators
key details
Who is this course for
Who should attend
- Any professionals who are keen to learn the structured trade finance business
- Corporate treasurers, finance directors, relationship managers, senior management in corporate lending, and sales teams looking at how to apply banking instruments into corporate finance sector
- Bankers and account managers engaged in structuring trade financing deals
- Professionals, executives, and managers working in middle office functions such as audit and operations, credit risk management, responsible for ensuring proper execution, management, and financing of commodity trades.
- Relationship managers and bankers who want to learn the financing aspects of commodity trades
Certificate of attendance
A certificate of attendance will be issued to participants who have attended and completed the programme.
FEES (subject to gst)
SGD $1,360
trainers
Our Resident Coaches
Michael Ong
- Accessibility consultant at SG Enable
- Principal Industry Training Officer at NTUC
