Advanced Trade Finance Masterclass

Introduction:

Protecting assets during domestic and international transactions is crucial for business success and sustainability. This Advanced Trade Finance Masterclass course equips professionals with the necessary skills to manage transactions with foreign firms effectively. Participants will learn how to negotiate optimal commercial terms, structure innovative trade finance deals, and implement advanced trading practices.

This course is essential for professionals seeking to enhance their expertise in trade finance and advanced trading strategies. By the end, participants will confidently navigate international trade finance, actively contribute to trade finance conferences, and master structured trade finance techniques.

Objectives:

By the end of this Advanced Trade Finance Masterclass, participants will be able to:

• Appreciate the global trade finance environment and market dynamics.
• Prepare for advanced finance master classes.
• Explain advanced trade finance concepts beyond traditional payment methods.
• Understand customer risk perceptions and associated paradoxes.
• Explain the prevalence of open account trading despite inherent risks.
• Discuss the continued relevance of letters of credit in international trade.
• Identify trade finance compliance risks, including FCC and AML considerations.
• Realize the profitability and low credit risk potential of well-managed trade finance.
• Understand the trade finance cycle and break-even analysis.
• Recognize the importance of sanctions in modern trade finance.
• Implement risk-based approaches in trade finance.
• Familiarize with financial crime compliance terms like DDD, FATF, TI, and CPI.
• Identify and assess traditional trade finance risks.
• Analyze key components of trade finance products and client risk profiles.
• Master supply chain finance concepts.
• Understand traditional and standby letters of credit.
• Address finance issues related to exporting and managing credit exposure.
• Explore effective use of collections for short-term financing.
• Understand international demand, contract guarantees, and bonds.

Training Methodology:

• Simulation exercises
• Fellow external expert sessions
• Case studies on real-life situations
• Skill acquisition training
• Industry-centered academic presentations
• Group discussions for problem-solving

Course Outline:

Unit 1: The Current Market Place

• Current trends and transformations in trade finance.
• Risks associated with new economies.
• Impact of China’s economy.
• Geo-political issues and protectionism.
• Differences in trade finance needs between global companies and SMEs.
• Understanding trade finance knowledge advantages.

Unit 2: Financial Crime Compliance & Sanctions

• Importance of compliance in trade finance.
• Risk management focus rather than product focus.
• Influencers in compliance: TI, CPI, FATF, Wolfsberg, ICC, OFAC.
• Concepts of C-DD, CDD, and the value chain.
• Money laundering approaches.
• Understanding documentary fraud and PEPS (Politically Exposed Persons).
• Overview of sanctions and restrictive measures.

Unit 3: Traditional Risks – The Critical Issues

• Risk management in trade finance procedures.
• Assessment of credit, market, operational, and political risks.
• Managing institutional and organizational risks in banks.
• Due diligence management and risk assessment for corporate exposures.
• Graphical assessment of importer and exporter risks.
• Managing geographic and transaction risks.
• Risk mitigation and transfer strategies.

Unit 4: Supply Chain Management & Finance

• Origins of supply chain management theoretical approaches.
• Resolving buyer vs. supplier issues.
• Promoting evolutionary changes in supply chain activities.
• Understanding the flow of information, goods, and money.
• Key supply chain finance models: accounts payable, accounts receivable, and BPO.
• Evaluating supply chain finance risk factors.

Unit 5: Standby Letters of Credit

• Evolution and background of standby letters of credit.
• Purpose and risk mitigation using standby letters of credit.
• Issuance, evaluation, and pricing approaches.
• Application of ISP98 and UCP 600.
• Fraud detection and prevention.

Unit 6: Export Finance Issues

• Understanding the need for export finance.
• Risks associated with different countries.
• Issues of title and control in export finance.
• Payment under letters of credit.
• Sale of firm undertakings and credit types.

Unit 7: Controlling Credit Exposure – Formulizing a Limit

• Analysis of the trade cycle.
• Optimal use of timelines.
• Evaluation and management of funding shortfalls.

Unit 8: Structuring Finance for the Trader

• Analysis of trade flow patterns for finance structuring.
• Evaluation of facility sizes and structures.
• Management of matured loans and repayment sources.

Unit 9: Efficient Employment of Collections for Short-Term Financing

• Introduction to arrears collection.
• Identifying risks and strategies to address them.
• Maintaining control in payments.

Unit 10: Backing the Trader

• Using commodities as loan security.
• Estimation of critical trade finance goods.
• Importance of pledges and trust receipts.
• Converting trade finance into debt instruments.