ICC BANKING COMMISSION MIAMI MEETING 2018: Day 1 - Global Survey on Trade Finance 2018
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Annual discussion on the latest developments on trade finance, in Miami on 3-6 April.
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ICC BANKING COMMISSION MIAMI MEETING 2018: Day 1 - Global Survey on Trade Finance 2018
- 1. ICC GLOBAL SURVEY ON TRADE FINANCE 2018 Selected Highlights April 2018 | Miami, USA
- 2. POLICY AND BUSINESS PRACTICES 251 UNIQUE RESPONDENT BANKS 8% 8% 12% 12% 14% 22% 25% North America Middle East Latin America Africa Central and Eastern Europe, the… Asia Pacific Western Europe Region 9 4 4 8 23 52 0 20 40 60 80 100 >501 401-500 301-400 151-300 51-150 <50 Number of employees involved delivery of Trade Finance products and solutions, % 28 29 26 17 0 20 40 60 80 100 < 1,000 1,000-9,999 10,000-99,999 >100,000 Number of trade finance transactions processed, % 8 14 26 32 14 8 0 20 40 60 80 100 <10 million 10-100 million 100 million-1 billion 1-10 billion 10 billion to 100 billion Over 100 billion
- 3. POLICY AND BUSINESS PRACTICES Canada United States Argentina Bolivia Brazil Chile Colombia Costa Rica Dominican Republic Ecuador Honduras Mexico Nicaragua Panama Paraguay Peru Cape Verde Ivory Coast Egypt Kenya Malawi Mauritius Morocco Mozambique Nigeria South Africa Sudan Tunisia Uganda United Republic of Tanzania Zambia Western Austria Belgium Denmark Finland France Germany Ireland Italy Luxembourg Malta Netherlands Norway Portugal Spain Sweden Switzerland United Kingdom Eastern Albania Armenia Belarus Bulgaria Croatia Czech Republic Cyprus Georgia Hungary Republic of Macedonia Romania Russia Serbia Turkey Ukraine Bahrain Iran Kuwait Lebanon Oman Palestine Qatar Saudi Arabia UAE Afghanistan Australia Bangladesh Bhutan China Hong Kong India Indonesia Japan Korea Malaysia Mongolia New Zealand Pakistan Philippines Singapore Sri Lanka Thailand EuropeAfricaLatin AmericaNorth America Middle East Asia-Pacific 91 PARTICIPATING COUNTRIES
- 4. POLICY AND BUSINESS PRACTICES OUTLOOK ON GLOBAL TRADE FINANCE GROWTH Next 12 months 73% Improve 22% Stay the same 5% Decline
- 5. POLICY AND BUSINESS PRACTICES OUTLOOK ON THE TRADE FINANCE GAP 1% 20% 57% 22% Close Reduce Remain consistent Widen 6% 41% 25% 28% 12 months 3 years In the next 3 yearsIn the next 12 months
- 6. POLICY AND BUSINESS PRACTICES APPROVED AND REJECTED TRADE FINANCE TRANSACTIONS IN 2017 61 68 71 39 32 29 0 20 40 60 80 100 Micro and SME Middle Market/mid-Cap Multinational and large corporate 93 89 89 83 83 82 79 7 11 11 17 17 18 21 0 20 40 60 80 100 North America Latin America Western Europe Cent. & EE Africa Middle East Asia Pacific By region % %Approved Rejected By client type
- 7. POLICY AND BUSINESS PRACTICES MAIN REASONS FOR REJECTIONS 10% 27% 23% 16% 10% 8% 6% Poor application or proposal Inability to complete KYC Failed KYC or due diligence Insufficient collateral Unacceptable risk profile Insufficient credit lines (country, bank or company)
- 8. POLICY AND BUSINESS PRACTICES TRADE FINANCE TRANSACTIONS PROCESSED IN 2017 Traditional Trade finance Percentage distribution Commercial letters of credit 49% Collections 24% Guarantees 16% Standby letters of credit 11% Supply Chain Finance Percentage distribution Payables finance 28% Receivables discounting 25% Factoring and its variations 17% Loan or advance against receivables 16% Pre shipment finance 6% Forfaiting 4% Loan or advance against inventory 3% Distributor finance 2%
- 9. POLICY AND BUSINESS PRACTICES TRADE FINANCE TRANSACTIONS ACROSS REGIONS North America 63% 37% Latin America 77% 23% Western Europe 89% 11% Cent. & EE 87% 13% Middle East 90% 10% Africa 88% 12% Asia-Pacific 88% 12% Traditional Trade Finance Supply Chain Finance
- 10. POLICY AND BUSINESS PRACTICES DIGITAL PROGRESS 3% 9% 13% 36% 30% 7% 3% We have successfully implemented solutions but benefits not yet evidenced We have successfully implemented resulting in a reduction of time and costs We are currently struggling to implement technology solutions We have implemented technology solutions but there is room for improvement Technology solutions implementation is on our agenda for the next 1-2 years Technology solutions implementation is not on our agenda at this time Don’t know DevelopingMature Not currently on agenda Implementation of a technology solution to achieve benefits such as reduced time and costs as well as improved precision associated with trade-related due diligence
- 11. POLICY AND BUSINESS PRACTICES REMOVAL OF PHYSICAL PAPER FOR DOCUMENTARY TRANSACTIONS 14% 7% 14% 51% 41% 51% 35% 52% 35% Issuance/Advising Document Verification Settlement/Financing To a great extent; fully implemented for all transactions To some extent; implemented for some transactions To no extent; not implemented at this time
- 12. POLICY AND BUSINESS PRACTICES OBSTACLES TO GROWTH AND LEVELS OF CONCERN 6% 13% 32% 33% 34% 34% 34% 38% 48% 93% 87% 66% 65% 64% 64% 63% 54% 48% Regulation and compliance Counter-terrorism and international sanctions regulation and compliance Competition and disruption from FinTechs and Non-Banks Increasing protectionist and trade- restrictive measures Volatile commodity markets Capital constraints Reduction in pool of senior technical specialists Legacy technologies Shifting trade flows and corridors Not at all concerned / Not very concerned Somewhat concerned / Extremely concerned Not applicable 1% 0% 2% 2% 2% 2% 3% 8% 4%
- 13. POLICY AND BUSINESS PRACTICES WE THANK OUR SPONSORS For our sponsorship opportunities visit: iccwbo.org/sponsor-global-survey Contact: Sandra Sanchez Nery at ssy@iccwbo.org