Trade Facilitation Programme Development of Trade Finance in - - PowerPoint PPT Presentation

Trade Facilitation Programme Development of Trade Finance in Tunisia

Kamola Makhmudova, Senior Banker, TFP 31 July 2018

Where we are

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64% 8% 10% 9% 9%

What is the EBRD?

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Established in 1991. The EBRD is owned by 66 countries from five continents, as well as the European Union and the European Investment Bank. These shareholders have each made a capital contribution, which forms our core funding. Capital base of €30 billion The EBRD has a triple-A rating from all three main rating agencies (S&P, Moody’s and Fitch)

As at January 2018

EBRD region

Excluding EU, Russia at 4%

USA EU27 countries

Includes European Community and European Investment Bank (EIB) each at 3%. Among other EU countries: France, Germany, Italy, and the UK each holds 8.6%

Japan Other

TFP – Strategy

Strong focus on: Small- and medium-sized private e banks in the CIS and south-east Europe Early Transition

• n Countries

es Souther ern and easter ern Mediter erranea ean (Greece, Cyprus, Egypt, Jordan, Morocco and Tunisia). New: Lebanon and the West Bank and Gaza Intra-reg egion

• nal trade

e (= trade between the EBRD’s countries of operations) SMEs Co Co-financing with commercial banks

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EBRD Trade Facilitation Programme

Annual Busines ess Volumes es 1999 – 2017

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TFP: 1, 905 Transactions in 2017

Ranking No of Transactions by Country

• 1. Greece
• 2. Serbia
• 3. Ukraine
• 4. Cyprus
• 5. Belarus
• 6. Armenia
• 7. Georgia
• 8. Morocco
• 9. Turkey
• 10. Egypt
• 11. Mongolia
• 12. FYR Macedonia
• 13. Romania
• 14. Kyrgyz Republic
• 15. Bulgaria
• 16. Jordan
• 17. Moldova
• 18. Croatia
• 19. Tajikistan
• 20. Azerbaijan
• 21. Kosovo
• 22. Montenegro
• 23. Bosnia and Herzegovina
• 24. Tunisia
• 25. Turkmenistan

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TFP: Achievements 1999-2017

• More than 21,600 foreign trade transactions
• Total business volume EUR 15 billion
• 95 Issuing Banks in 27 countries
• Over 800 Confirming Banks worldwide

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800 Confirming Banks in 77 Countries

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EBRD TFP: Top 10 Confirming Banks

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Ranke ked by number of transa sact ctions s in 2017

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1. Commerzbank 2. ING Bank 3. UNICREDIT BANK AUSTRIA 4. Citibank Europe 5. Deutsche Bank

• 6. BANCA POPOLARE DI SONDRIO
• 7. KBC Bank
• 8. ODDO BHF Aktiengesellschaft
• 9. UBS AG
• 10. INTESA SANPAOLO SPA

TFP Application Area

Facilitates financing of all stages of the trade chain

10

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Trade Facili litation Pro rogra ramme

(EUR 1.5 bln framework) Trade e Finance e Guarantee Facility (fully operational since 1999)

Trade Finance Cash Facility - Revolving Cred edit Agree eement (RCA) (launched in 2000)

EBRD TFP Facilities

Two main components

TFP – How does it work

TFP supports trading by providing:

 Guarantees es that cover risks arising from trade finance transactions  Short-ter erm advances es/financing to banks in the Countries of Operation for trade finance purposes  Donor funded trade e finance e training and advisor

• ry ser

ervices es to local banks

TFP: Guarantee Structure and Application

Confirming Bank, Worldwide Seller er

Application for L/C opening

L/C Confirmation

• n

EBRD issues es a Stand-By Letter er of Cred edit cov

• vering

the risks of Issuing Bank towards the e Con

• nfirming bank

Issuing Bank, Countr try of Oper erati tion

• ns

Buyer er

L/C Issuance with request to confi firm (L/G G Issuance with counter-guarantee, ,

• ther banki

king trade finance instruments)

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TFP: Guarantee Transaction (1)

 Always involves a local bank (“Issuing Bank”) which issues a trade finance instrument (e.g. letter of credit) and a foreign bank which confirms it to the beneficiary (“Confirming Bank”);  Issued only to Confirming Bank, not to exporters or importers;  The trade finance instrument (e.g. a letter of credit) en ensures es that the beneficiary receives payment upon or after delivery.

TFP: Guarantee Transaction (2)

Covers s all type pes of trade de finance ce inst struments:

 documentary letters of credit (LCs), including deferred payment/post- financing;  bank payment guarantees;  trade related standby LCs from issuing banks;  bid and performance bonds;  advanced payment guarantees;  trade-related promissory notes or bills of exchange. EBRD Guarantee (a SBLC under UCP 600) is usually issued within 24 hours from application

TFP: Guarantee Transaction (3)

 Cover of exports, imports and distribution of imported goods in the EBRD’s countries of operations, irrespective of the country of origin (no

• rigin rule)

 Tenor: 3 years maximum  Amount: no minimum amount  EBRD pays on the claim within 15 15 days  EBRD Guarantee covers up to 100% of the face value of the underlying trade finance instruments, covering payment, political and currency risks

EBRD TFP Guarantees: Case Study

Import of olive oil processing equipment to Tunisia

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BANQU QUE TUNISO SO-KOWEITIENNE

IMPORT OF OLIVE OIL PROCESSING EQUIPMENT FROM TURKEY TO TUNISIA

BTK issued a Letter of Credit in favour of Turk Ekonomi Bankasi A.S., Istanbul, Turkey, also a partner bank, and participant of EBRD’s Trade Facilitation Programme EBRD issued a guarantee in favour of Turk Ekonomi Bankasi A.S., Istanbul, Turkey

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EBRD TFP Guarantees: Case Study Import of Samsung equipment to Tunisia

AMEN BANK

IMPORT OF SAMSUNG EQUIPMENT FROM MOROCCO TO TUN UNISIA

Amen Bank issued a Letter of Credit in favour of Banque Centrale Populaire (BCP), Casablanca, Morocco, also a partner bank, and participant of EBRD’s Trade Facilitation Programme in the SEMED (MENA) Region EBRD issued a guarantee in favour of BCP

TFP Benefits (1)

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For Issuing Banks and Customers

• Issuing Banks develop a track record with Confirming Banks (strong

evidence that Confirming Banks follow EBRD’s lead in establishing unsecured trade exposure limits to Issuing Banks)

• No cash collateral required from Issuing Banks, hence cheaper financing

terms for exporters/importers

– Clients: more competitive exports and imports – Issuing Banks: enhance competitiveness vis-à-vis other banks – EBRD: reduce costs of transactions – Additional opportunity of flexible financing through RCA for pre-export and

post-import financing

• Assistance to Issuing Banks in structuring trade transactions through

institutional building in the form of technical assistance

TFP Benefits (2)

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For Confirming Banks & Exporters

• Additional export business to EBRD

countries of operation in Central & Eastern Europe CIS and SEMED countries with mitigated risks

• Business development
• Possibility to offer favourable credit

terms to the customers, including longer tenors and larger amounts

Trade Finance Cash Facility

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Local Company Local Bank (EBRD’s borrower)

• Takes local company risk
• Borrows from EBRD
• On-lends to the local company

EBRD

• Takes local bank risk and lends to the

local bank against sub-borrower base Repayment to EBRD EBRD’s disbursement Loan repayment Loan disbursement

TFP Factoring Case Study

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TFP: Our partner banks in Tunisia

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ISSU SUIN ING BAN ANKS

• 1. BTK
• 2. Amen Bank
• 3. UIB
• 4. UBCI
• 5. Banque de Tunisie

EBRD – Capacity Building Projects

Face-to-face learning Self-paced learning Online collaborative learning

EBRD Trade Finance e-Learning Programme

To date > 3,000 trade pro rofessionals fro rom 240 240 institutions s in 36 countri ries s enroll lled

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EBRD TFP e-Learning Programme

List of Cou

• urses

es

• Introduction to Trade Finance
• Introduction to Factoring
• Collections
• Mentor 600
• DC Master
• ISP Master
• URDG Master
• Incoterms 2010
• Environmental and Social Issues in

Trade

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Target et Audien ence

• Trade finance team
• Relationship managers
• Risk managers
• Legal team
• Operations team
• Other professionals interested in

factoring products

EBRD TFP e-Learning Programme in Tunisia

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 250 students registered  67

67 graduated Best students awarded prizes and sponsored trainings in leading European confirming banks and training companies:

NEW TRAINING FRAMEWORK 2018

EBRD compliance training for trade finance

I. E-Learning Course II. ICA certification and ICA membership

• III. Individual advisory services for EBRD partner banks – “Correspondent

banking technical assistance “

Know your client? Kill your client?

OR

NEW TRAINING FRAMEWORK 2018

EBRD compliance training for trade finance 1/4

E-learning : Since 2010 EBRD offers wide range of Trade Finance E-learning programmes to partner

• banks. The programme was developed with the co-
• peration of International Chambers of Commerce

(ICC). NEW: Trade Based ed Financial Crime Compliance training mod

• dule cov
• ver

ering GBP GBP 795 795.00 00

• 1. Financial Crime Regulation
• 2. The Compliance Programme
• 3. Exercising Due Diligence
• 4. Indicators of Trade Based Financial Crimes
• 5. Combating Financial Crime

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NEW TRAINING FRAMEWORK 2018

EBRD compliance training for trade finance 2/4

EBRD and International Compliance Association (ICA) to offer scholarships on Compliance Certification Courses.

• ICA Certification in

in KYC and CDD EUR 695 695.00 00

• ICA Specialist Cer

ertification in in Tra rade Based ed Money ey Launder ering EUR 695 695.00 00

• Target Audience
• Trade finance opera

rations staff

• Trade finance rel

elationship manager ers

• Trade finance risk manager

ers

• Bank audit and compliance staff
• Bank managemen

ent

• Lawyer

ers work rking in in compliance

• Further, the EBRD will support individuals to improve their existing knowledge still further

by proving them access to comprehensive CPD, news and information as well as the global compliance community through pro rofes essional mem embers rship of the International Compliance Association.

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NEW TRAINING FRAMEWORK 2018

EBRD compliance training for trade finance 3/4

• ICA Certification
• n in

in KYC and CDD: this training course provides a foundation

knowledge of core know your customer (KYC) and customer due diligence (CDD) concepts, and introduction to CDD frameworks and an

• verview of the key components of working in the KYC environment.
• ICA Specialist Certification
• n in

in Trade Based ed Mon

• ney Lou
• undering: Certificate in

Trade Based Money Laundering provides staff with an opportunity to look at the AML and CTF models used to address the risks that exists within the international trade environment. The course will also investigate some of the practical issues faced, where breaching money laundering requirements can cost hundreds of millions of dollars.

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NEW TRAINING FRAMEWORK 2018

EBRD compliance training for trade finance 4/4

EBRD will offer individual correspondent banking advisory services to its partner banks as part of the Compliance Advisory Services Framework.

• The goal of the programme is to help partner banks to optimise and standardize

KYC required documents and enhance their correspondent banking relationships with EBRD TFP networking platform of over 800 Confirming Banks.

• Custom
• mised

ed Advisor

• ry Ser

ervices es

• Turn around CB DD and KYC
• Demystifying new Wolfsberg CB DDQ
• BAFT Respondents Playbook
• Internal Operational/System changes, training, revised requirements
• Assessment and implementation of appropriate timeline till 2019

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TFP Trade Exchange Magazine

• Launched in 2011
• 12

12 publications to date

• Dedicated to Trade Finance and

EBRD Technical Assistance Projects

• 5,000 Reader

ers from 1,000 Banks

Repor

• rts on:
• News & Events
• Regional Focus Features
• In Depth sector Key Issues
• Trade Projects

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Contacts

34

Trade e Facilitation

• n Prog
• gramme

Euro ropean Bank for Re Reconstruction and Development

One Exchange Square London EC2A 2JN United Kingdom

Kamola Makh khmudova

Tel: +44 20 7338 6000 Email: makhmudk@ebrd.com

Irina Tyan

Tel: +44 20 73386000 Email: tyani@ebrd.com Web-site: www.ebrd.com/tfp Join us s in soci cial netwo works: s: Twitter: www.twitter.com/ebrdtrade Facebook: www.facebook.com/ebrdtfp LinkedIn: www.linkedin.com/groups?gid=4667852