OREANDA-NEWS. February 07, 2013. In 2012, ICBC offered international trade facility as an important measure to shore up export and support the healthy growth of real economy. The Bank assisted foreign trade companies to weather the changing market conditions by addressing their need of working capital, reducing their borrowing cost and risks. 2012 data showed that ICBC has provided over USD 200 billion in international trade finance, a jump of more than 33% year-on-year. In the year, ICBC ranked No.1 among the peers in terms of total amount and balance in international trade facility to foreign trade companies for their solid growth, reported the press-centre of ICBC.

ICBC expands the supply chain finance services to cope with the changes in import/export and actual needs of foreign trade companies. That included a full spectrum of products in home and foreign currencies for domestic and foreign trade, processing trade security deposit ledger, integrated trade finance products and services. At present, at the heart of ICBC product offering in international trade finance are import L/C opening, import documentary bill, forfaiting, export factoring, order financing, export invoice financing. The "Service Mart" of ICBC representing a free combination of settlement, finance and wealth management provides a range of integrated services in settlement, finance, wealth management and risk management encompassing all the steps in international trade and extending to domestic trade. Backed by the state-of-the-art IT systems and overseas network, ICBC branches in China and overseas join force to provide unique trade finance solutions tailored to customers engaged in international trade, helping them effectively reduce capital cost, circumvent exchange rate risk, relieve financial burden arising from payment to external parties and assure timely collection of account receivables.

To improve the trade finance services, ICBC strictly follows national measures of promoting foreign trade to launch innovative financial services for exporters. On August 1, 2012, ICBC settled the first FX payment (import) and FX collection (export) in China under the new FX administration for trade in goods. This was also the first import/export FX settlement since the new FX administration for trade in goods was in force. When compared as before, ICBC counter staff now save 73% time in handling one FX receipt on export, 64% time in making one FX payment on import, since it involves fewer steps. For import and export companies, this means higher working capital turnover.

ICBC has paid particular attention on the support to small-and-medium foreign trade companies while offering innovative financial services for exporters. When granting credit to small-and-medium foreign trade companies, ICBC uses their sales revenue and operating cash flow as the key criteria since they have less net assets and high liability ratio, but reliable trading relationship, stable logistics and cash flow. Meanwhile, in response to the strong timeliness and high efficiency of small-and-medium foreign trade companies in obtaining "short, frequent, urgent" loans, ICBC has streamlined its business processes covering credit rating, credit authorization, evaluation of pledge and approval. From market study ICBC learnt that a great number of small foreign trade companies settled with their foreign importers on a term of credit sale.

However, the changes in creditability of foreign importers since the global financial crisis bring uncertainty to these companies who are not certain if they can collect the goods amount in time. In light of this, ICBC launched the buy-out export dual factoring service to facilitate their cash flow. ICBC as the export factor and import factor jointly provide a range of financial services including trade finance for exporters, checking and evaluation of importers' creditability, sales ledger processing, account receivable management and collection. These services not only help small companies address cash shortfall after shipment of goods and relieve their cash turnover. Early collection of account receivables by cash income improves their cash flow. On top of this, small companies can also settle their foreign currency in advance and apply for tax rebate for export to lock down exchange rate risk and increase the competitiveness of export products.

Today, ICBC has set up a highly efficient network in different parts of the world for domestic and foreign trade finance serving different customers. In China, ICBC is the first bank to build a network of key branches offering excellent services and innovative products in trade finance to attract more customers. The goal is to drive the international trade finance services under the leadership of these key branches. Meanwhile, ICBC steps up the support to provide trade finance solutions to companies in Midwestern and Northeast China, as these companies change their approach to expand internationally or engage in coastal business.

The economic restructuring in these regions (China's export zones) is propelled by the growth of international trade finance loans which is higher than ICBC's average. Worldwide, ICBC sets up own multi-currency clearing network in major financial centers around the world to help companies reduce the cost of exchanging currency. Today, ICBC has a network providing round-the-clock services in clearing major currencies from USD Clearing Center in New York, EUR Clearing Center in Frankfurt and JPY Clearing Center in Tokyo. Nowadays, companies can remit money from overseas faster and cheaper, since it no longer needs to go through foreign banks outside China and domestic banks as before.