Multinational Financial Management（跨国公司财务管理）ch18 International Trade Financing.ppt

CHAPTER18,InternationalTradeFinancing,PAYMENTTERMS,I.PAYMENTTERMSA.FourPrincipalMeans:1.Cashinadvance2.LetterofCredit3.Drafts4.OpenAccount,PAYMENTTERMS,B.CashinAdvance1.Minimalrisktoexporter2.Usedwherethereisa.Politicalunrestb.Goodsmadetoorderc.Newandunfamiliarcustomer,PAYMENTTERMS,C.LetterofCredit(L/C)1.Amisingtohonorsellersdrafts.c.Banksubstitutesitsowncommitmentd.Sellermustconformtoterms,PAYMENTTERMS,2.AdvantagesofanL/CtoExportera.eliminatescreditriskb.pre-shipment(cancellationoftheorder)riskprotection,PAYMENTTERMS,3.AdvantagesofL/CtoImportera.shipmentassuredb.documentsinspectedc.mayallowbettersalestermsd.relativelylow-costfinancinge.ifdiscrepancies,easycashrecovery,PAYMENTTERMS,4.TypesofL/Csa.documentaryb.irrevocablec.confirmed,PAYMENTTERMS,D.DRAFTS1.Definition:-unconditionalorderinwriting-exportersorderforimportertopay-atonce(sightdraft)or-infuture(timedraft),PAYMENTTERMS,2.ThreeFunctionsofDraftsa.clearevidenceoffinancialobligationb.reducedfinancingcostsc.Canbeafinancialproductforinvestors(i.e.Maybeconvertedtoabankersacceptance),PAYMENTTERMS,3.TypesofDraftsa.sightb.time,PAYMENTTERMS,F.OPENACCOUNT1.Createsacreditsale2.Toimportersadvantage3.Morepopularlatelybecausea.majorsurgeinglobaltradeb.creditinformationimprovedc.moreglobalfamiliaritywithexporting,PAYMENTTERMS,4.BenefitsofOpenAccounts:a.greaterflexibilityinmakingatradeb.lowertransactionscosts5.Majordisadvantage:highlyvulnerabletogovernmentcurrencycontrols.,DOCUMENTS,II.DOCUMENTSUSEDININTLTRADEA.Threemostuseddocuments1.BillofLading(mostimportant)2.CommercialInvoice3.InsuranceCertificate,DOCUMENTS,B.BillofLadingThreefunctions:1.Actsasacontracttocarrythegoods.2.Actsasashippersreceipt3.Establishesownershipovergoodsifnegotiabletype.,DOCUMENTS,C.COMMERCIALINVOICEPurpose:1.Listsfulldetailsofgoodsshipped2.Namesofimporter/exportergiven3.Identifiespaymentterms4.Listchargesfortransportandinsurance.,DOCUMENTS,D.INSURANCE1.MarineInsurancePolicycoversseaaswellasairtransport2.InsuranceCertificateissuedtoshowproofofinsurance,SHORT-TERMFINANCINGTECHNIQUES,III.FINANCINGTECHNIQUESA.FourTypes:1.BankersAcceptancesa.Creation:draftsacceptedb.Terms:Payableatmaturitytoholder,SHORT-TERMFINANCINGTECHNIQUES,2.Discountinga.Convertsexportersdraftstocashminusinteresttomaturityandcommissions.b.Lowcostfinancingwithfewfeesc.Maybewith(exporterstillliable)orwithoutrecourse(banktakesliabilityfornonpayment).,SHORT-TERMFINANCINGTECHNIQUES,3.Factoringfirmssellaccountsreceivabletoanotherfirmknownasthefactor.a.Discountchargedbyfactorb.Non-recoursebasis:Factorassumesallpaymentrisk.c.Whenused:1.)Occasionalexporting2.)Clientsgeographicallydispersed.,SHORT-TERMFINANCINGTECHNIQUES,4.Forfaitinga.Definition:discountingatafixedratewithoutrecourseformedium-termaccountsreceivableb.Use:Largecapitalpurchasesc.MostpopularinW.Europe,GOVERNMENTSOURCES,IV.GOVERNMENTSOURCESOFEXPORTFINANCINGANDCREDITINSURANCEA.Export-ImportBankoftheU.S.-knownasEx-ImBank-financesandfacilitatesU.S.exportsonly.,GOVERNMENTSOURCES,1.Ex-ImBankPrograms:a.Directloanstoexportersb.Intermediateloanstoexportersc.Loanguaranteesd.Preliminarycommitmentse.Politicalandcommercialinsurance,GOVERNMENTSOURCES,2.Restrictions:Atleast51%U.S.contentNoarmamentsMustbeenvironmentallyfriendly,COUNTERTRADE,V.COUNTERTRADEA.ThreeSpecificForms:1.Barterdirectexchangeinkind2.Counterpurchasesale/purchaseofunrelatedgoodsbutwithcurrencies