Risk Management in Trade Finance

Overview

This programme provides a comprehensive understanding of the principles and practices of risk management in the context of international and domestic trade finance. It equips participants with the knowledge to identify, assess, and mitigate the financial, operational, and compliance risks that arise in trade transactions.

Objective

• Understand why trade finance is generally low risk for credit losses – IF done properly
• Appreciate the range of risks involved in trade finance
• Understand the controls and mitigants available
• Be able to categorise risk according to client size and strength
• Appreciate the mechanisms of the working capital cycle
• Recognise that structured lending facilitates easier and closer control
• Appreciate why some structured trade finance lines can sometimes enable the bank to assist a weak or extended balance sheet
• Understand why trade finance is considered high risk for AML
• Be able to see risks in the round
• Be much better equipped to assess, consider and support trade finance propositions based on comprehensive understanding of the risks