Letters of Credit Vs Documentary Collection
Following on from Aidan's video on the risk ladder, he continues his series on Trade Finance by looking at how the documentary Letter of Credit works and how its role is similar to that of the Documentary Collection.
Overview
This video covers the basic trade finance risk management tools in order to protect both the buyer and the seller. These include; documentary letters of credit, a documentary collection, and bonds and guarantees.
Key learning objectives:
How does the LC process work?
How does the documentary collection process work?
How can the bank use bonds and guarantees to manage risk?
Summary
Expert
Aidan Applegarth
Aidan spent some 30 years building up Trade and Commodity Finance (TCF) businesses for banks in the UK, Europe and Asia. He is now a consultant providing training and practical guidance to banks and other lenders wishing to develop a TCF proposition and also advises a number of Trade Finance funds on Credit and Operational Risk.
