08.02.2020: TRADE FINANCE

There are various instruments and concepts for trade financing which are already well known in international banking practice and actively applied. They are an indispensable part of foreign trade. Contractual partners in foreign trade such as SUISSE BANK PLC have the option of applying international rules and trade customs in clearing transactions, in particular the standard guidelines and customs for documentary letters of credit and payment guarantees.

The banking system makes it possible for importers to use trade financing tools not only as an accounting means for contracts with exporters, but also as a means of procuring cheaper and longer-term borrowed funds from abroad to finance import transactions and the development of their business.

The primary tools for short-term trade finance are: 

  • bank guarantees,
  • documentary letters of credit,
  • standby letters of credit.

The core business field of SUISSE BANK PLC consists of the sale of financial instruments to its approved clients. The main sales are made in a short-term period (365 + 1 days) and are spread between guarantees, standby letters of credit and documentary letters of credit. Many market participants have neither the volume nor the liquid funds to purchase hedging instruments from top banks. The commitment of SUISSE BANK PLC has proved itself in many regards and in different types of applications ranging from project financing to import/export financing. Frequently linked with an offshore account, SUISSE BANK PLC has now registered very substantial growth in companies that are operating internationally who in the future will be happy to transact business through our house.

SUISSE BANK PLC is not a public bank and may only act on behalf of its own clients. Joining is child's play: you will find the subscription documents on our website - in the section Become Approved Client - with a description of the necessary attachments. The Compliance Agreement in the download is an editable pdf file which can simply be filled in on the screen and printed out. SUISSE BANK PLC has also provided all the applications for bank instruments just as simply on its site as editable pdf files, and you can find them in the Trade Finance section.

SUISSE BANK PLC is cooperating ever more closely with brokers who are also based throughout the world in line with the worldwide clientele of our bank. Please get in touch with us if your clientele matches this profile.

It is important to mention that trade financing opens up additional options to each of the parties in addition to economic benefits. The importer gains the facility to finance and enter into long-term foreign trade relations, the exporter receives guaranteed and timely payment from the transaction (in the event all parties observe the contractual conditions) and the banks extend their cooperative relationship in the international banking market and thus promote foreign trade relationships between their countries. Additional benefits also frequently arise if both the importer and the exporter hold offshore accounts with the same bank. This begins with the banking fees: although the origins of a payment are to be found in an international commercial transaction, this remains an internal booking in technical banking terms with correspondingly low costs.