TF strengthens Deutsche’s Q4 results

Deutsche Bank’s global transaction banking division has seen an increase in net revenues due to substantial growth in its trade finance products.

Concerns over supply chain risks soar

Supply chain risks are moving up the agenda of many corporates as concerns about potential geopolitical problems and counterparty risks grow.

Managing both the physical and financial supply chain was a key topic at the annual World Economic Forum meeting in Davos, Switzerland last week, as delegates debated how companies can better cope with the unexpected, citing examples such as last year’s Japan nuclear crisis and the increasing level of piracy seen off the coast of Africa.

Swift reveals documentary trade fall in 2011

The use of documentary trade instruments such as letters of credit fell by just over 2% in 2011 compared to the previous year, according to the latest Swift statistics.

Ace launches trade credit portal

Political risk insurer Ace has launched ACE 360, a web portal allowing clients to monitor and administer their trade credit policies online.

EU regulators under pressure to amend CRD4

Banks and businesses are calling for EU regulators to amend the proposed new capital requirements.

XL names political risk team

XL Insurance has named the three former QBE members that have joined its global political risk and trade credit team in London.

GTR reveals Best Deals 2011

GTR has whittled down a huge number of best deal submissions to under 30 winning transactions.

We hope that the selected deals reflect the diversity of the trade, supply chain and export finance market. The winning list includes transactions closed in various countries including Iraq, Azerbaijan, Angola, Guatemala and Ghana.

We also saw a wide range of sectors supported by the trade and export finance banking industry, including the financing of satellites, car ferries, telecoms equipment, radars, cocoa and cashew nuts, among many others.

Baft-IFSA elects new board

Financial services group Baft-IFSA elected new members to its 2012-13 board at the group’s global annual meeting in Europe this week.

Factoring services are in high demand

Since the global financial crisis there been an increased awareness in factoring products and their ability to finance domestic and international trade, according to Malta’s FimBank.

ICC predicts gloomy outlook for trade

The demand for trade finance products will wane in 2012, according to research by the International Chamber of Commerce and the International Monetary Fund.

The research is based on a joint ICC-IMF survey among 337 financial institutions which indicated the emergence of a two-speed financial system with the outlook for emerging Asia being the strongest, and the eurozone lagging behind as the weakest.

SMBC buys RBS aviation business

RBS has agreed to sell its aviation business to Sumitomo Mitsui Banking Corporation for US$7.3bn.

JP Morgan sells off Vastera

Shipping logistics firm Livingston International has acquired the customs and trade compliance services of JP Morgan’s global trade business, formerly known as Vastera.

RBS shake-up sees GTS division restructured

RBS is set to restructure its global transaction services division, which includes trade finance.

Viewpoint January 11, 2011

GTR editor Rebecca Spong looks forward to 2012 and asks what kind of New Year resolutions the market should be making.

Time to make resolutions for trade

Optimists are hard to find in the banking world as 2012 begins. There’s heightened job uncertainty, jittery markets and a big question mark over how the eurozone crisis will resolve itself.

But New Year is also a time for resolutions and figuring out a way of improving ourselves.

We at GTR have come up with a number of resolutions for the trade finance market; suggestions that could mean that the industry ends 2012 in a better state than it left 2011.

Regulatory issues: One thing we hear time and time again at conferences and roundtables is the need to inform clients of the impact of Basel III. Banks’ customers will need to understand why they are being charged more for their trade facilities.

Regulators may listen more to the arguments of corporates than the complaints of bankers.

Don’t try to be good at everything: The end of the global banking era was heralded by some last year. Perhaps a slightly over-dramatic stance to take, but there is definitely the need for banks to focus on their strengths and not try to provide every service or product in every region. We often hear warnings that bankers need to do business in regions and with risks they understand.

Ensuring senior management is aware of the relevance of your business: As the cliché goes, trade finance is the oil that keeps the wheels of trade turning. Trade finance is vital for world trade, particularly in the emerging markets. It is also a low risk fee-driven business that will keep generating regular income for your bank, in both the good times and bad.

Price risk correctly: The market itself has to also make efforts to ensure it remains a profitable and respected business. GTR often hears complaints of bankers not pricing deals in a way that actually reflect the risks involved.

Forget preconceived ideas on country risk: Reconsider what you think makes a good risk. The tables have turned in recent years, with growth stagnating in Europe and the US and markets in Brazil and areas of Africa booming.

Is 2012 the year to take a different approach when considering your country limits?

Development and aid: The need to finance deals that support the development of poorer countries might not be a top concern right now as people worry about where the next set of job cuts might happen. However, perhaps there is a way that banks work with multilaterals or development banks in supporting the growth of poverty-stricken nations, while also generating shareholder return?

The reputation of the banking industry has been sullied in recent years – perhaps it is time to demonstrate the social value banks can bring to the world?

The latest data from Dealogic reveals that the final quarter of 2011 saw a significant dip in trade finance activity; no doubt a reflection of the wider market volatility.

However the first nine months saw almost record volumes of trade finance.

The market will need to make efforts to ensure it can return to the success of early 2011 and survive any current turmoil.

What other resolutions should the market make?

Are you feeling optimistic about the outlook for 2012?

Trade finance volumes hit new low

Trade finance activity fell to a new low in the fourth quarter of 2011, according to new data from Dealogic.

Just 137 deals were recorded in the final quarter of last year, the lowest level seen since Q1 in 2004 when just 113 deals were closed.