World's Best Trade Finance Providers 2017

GLOBAL WINNERS

With a global network of more than 100 trade centers in 60 of the 74 countries where it operates, BNP Paribas provides a wide range of trade finance solutions, including structured finance and customized supply-chain management, as well as Web-based platforms. The bank works with more than 40,000 corporations across all industries worldwide and handles more than 14 million trade transactions a year. BNP Paribas offers databases and services to help corporate clients prospect internationally for trade partners. The bank has initiated a groupwide drive to digitize all of its activities and has been investigating the use of blockchain technology and distributed ledgers since 2011.

The EBRD’s Trade Facilitation Program (TFP) includes more than 100 issuing banks in 23 countries in Central and Eastern Europe, the Commonwealth of Independent States, and the Southern and Eastern Mediterranean. The issuing banks work with more than 800 confirming banks worldwide. The TFP provides cover for a broad range of trade finance instruments and can be used to guarantee against political and commercial payment risk. The TFP also provides short-term loans to banks and factoring companies for lending to local exporters and importers. The countries where it has been most active recently include Ukraine, Armenia, Cyprus, Belarus and Serbia, according to the EBRD.

Utrecht, Netherlands-based Rabobank has offices worldwide staffed with experts in trade and commodities. The bank has long been active in financing global trade in agricultural commodities, energy and metals. Rabobank offers specialized products at every stage of the trade flow. The bank confirms and discounts large volumes of export letters of credit. It also provides ownership-based financing solutions, as an alternative to regular financing, through its structured inventory products.

Trade finance historically has been a paper-intensive business. BofA Merrill Lynch’s CashPro Trade platform streamlines the process of document identification and retrieval through the use of innovative data-capture technology. The bank created the document images module based on direct input from numerous trade clients. Using intelligent character recognition and optical character recognition (ICR/OCR) technology, the application recognizes metadata (such as invoice numbers and transaction amounts) during a document search. The bank says the tool simplifies trade document processing and compliance checking.

Resolving the problem of unpaid invoices is no small matter in international trade. Coface, a subsidiary of French bank Natixis, offers trade credit insurance in more than 200 countries. It has experienced emerging market losses recently, mainly in Latin America and Asia, but has adopted stricter underwriting guidelines and is focusing more on profitability than on growth. Coface offers many options to cover various types of risk, including nonpayment due to a war or currency transfer restriction, and manufacturing costs when the buyer becomes insolvent before the goods are delivered. Coface’s client retention rate remains strong, at about 90%.

BEST BANK FOR EXPORT FINANCE

About 20% of the eurozone’s exports go through Commerzbank, the most active bank for processing German export letters of credit. For the 12th straight year, in 2016, Commerzbank confirmed more letters of credit and guarantees for the EBRD’s Trade Facilitation Programme than did any other bank. More than 100 issuing banks in 19 countries have used Commerzbank as a confirming bank under the TFP. With a presence in more than 50 countries, and 5,000 correspondent-banking relationships, Commerzbank settles more than $100 billion of trade transactions annually. It is the leading trade bank for German small and medium enterprises, and it also provides complex project finance cover for large machinery exporters.

ANZ offers a broad array of structured trade and commodity finance products. Its specialized team of structured trade bankers focuses mainly on financing cross-border commodity flows in order to enhance the credit rating of the facility beyond that of the borrower. Each arrangement is tailored to the specific needs of the client. Products include warehouse financing, pre-export finance and reserve-based lending. ANZ also offers borrowing-base financing, whereby working-capital financing is structured on a client’s inventory and receivables.

Societe Generale offers strong trade expertise in more than 50 countries, including 18 in Africa and 15 in Central and Eastern Europe. In North Africa, the bank has a high penetration rate in trade finance in Tunisia, Morocco and Algeria. It says it is the leading bank in Cameroon and Cote d’Ivoire, and number two in Senegal. In CEE, Societe Generale claims to be the third-largest bank in the Czech Republic, number two in Romania, and the second-largest private bank in Russia (Rosbank). It has a close working relationship with the Russian Export Insurance Agency.

Standard Chartered is a leading global trade finance bank, processing $100 billion of exports annually, including letters of credit, documentary collections and invoice financing. The UK-based bank has a direct presence in 15 African countries. Through its alliance network, it provides coverage to an additional 23 countries in sub-Saharan Africa. Standard Chartered is the first foreign-owned bank with an on-the-ground presence in Iraq. It offers a strong portfolio of Islamic banking products in the Middle East region.