Лекции по английскому языку для изучающих банковское и финансовое дело. Лекции по английскому языку для изучающих банковское и финансов. Составитель Н. А. Самуэльян
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Midland Bank Group. Midland Bank, as a leading international bank, offers a full financing service lo UK and overseas exporters. Overdraft facililies for exporting, advances againsl and negolialions of bills and documenlary credil operations are readily available. Initial conlacl should be made wilh Midland's local bank branch or one of Ihe International Division regional branches. Midland Bank Group International Trade Services provides trade finance to UK and overseas exporters, including 198 199 the negotiation of credit insurance where necessary. Its UK export finance pouse subsidiary is Midland International Trade Services I(UK) Ltd. Griffin Factors, part of Midland's Forward Trust Group, is a major UK export factoring company. Griffin is a member of Factors Chain International which links factoring companies in major trading nations, providing information and services for Griffin clients in several overseas markets. Samuel Montagu and Co., Midland's international merchant bank, provides medium and long-term finance for exports, including Eurocurrency loans and bond issues, and equity and joint venture participations. Samuel Montagu is a member of the Accepting Houses Commit lee and conducts regular acceplancc credits business. Forward Trust Group can assist UK exporters of capital goods by arranging leasing operations through major leasing companies in many parts of the world. Through its membership of two internalional leasing associalions, Ebiclease and Leaseclub, Forward Trust is in contacl wilh major leasing companies to enable exporters to obtain prompt service and accurate information on the conditions of leasing for their overseas buyers. Forward Trust has a growing instalment finance business with various major trading nations. Through its connections with EXFINTER (Export Finance International) it provides instalment finance of various kinds in several European countries. Forward Troust Group also coordinates all the factoring, leasing and instalment finance aclivilies of Midland Bank Group. Whatever the financial requirements of UK exporters, the various associated companies of Midland Bank Group can meet them, whether for a short or longer credit period, whether an exporter or a buyer receives it; and in whatever form it is needed. I Comprehension. Answer the following questions: 1. What is often the best way of financing large and complex export contracts? 2. What contracls are buyer credit financing facilities usu ally available for?
be arranged?
seas buyer? Whal does the choice depend on? 9. Who is Ihe need for a general purpose line of credil deter mined by?
available under lines of credil usually cover? And how is the resl of Ihe conlracl value normally balanced?
200 201 II Comprehension. Complete the following on the basis of the information given in the text:
or with to cover
of
10. If Eurocurrency loans for the financing of down payments by buyers for large projects abroad are required, appli cations should be to one of for example: 11. An exporter of a large item of capital equipment can find the services of a beneficial in obtaining and on the conditions of In this case he can be assfssted by 12. Midland Bank Forward Trust Group is a member of two III Test. Fill in the missing words: Lines of credit are covered by ECGD Buyer Credit Guar antees. They allow UK banks to make available at pref erential to overseas borrowers to the purchase of a wide range of goods and services from various UK with contract values sometimes as low as being covered. A general purpose line of credit can be used for a of types of contract with various in the country of import. A project line of credit is established for a project but perhaps involving many different Under the line of arrangement the exporter receives payment delivery of goods or of services and has in effect a cash  202 Unit Nine Foreign Currency for Exports TEXT Read the text below concentrating on its contents and terminology: It is becoming more popular for exporters to accept payment for their orders in the currency used by their overseas buyers. There are several reasons for this. Some goods are traded internationally in one particular currency, e.g. oil sales in dollars. A buyer may traditionally prefer to price a contract in a particular currency, e.g. Latin American importers usually wish to be invoiced in dollars. Buyers are aware oflhe fluctuating nature of rates of exchange for major trading currencies and may prescribe contracts priced in a currency that they expect to depreciate before final payment. By quoting in this currency, an exporter may 1ю able to gain Active Vocabulary: convertible foreign exchange market forward exchange market forward rate spot rate at a premium at a discount commission fee
an advantage over competitors unwilling to do likewise. If an exporter uses credit finance, the cost of borrowing may be cheaper in a foreign currency than in sterling. However, an exporter must consider carefully the consequences of any invoicing contract in a buyer's currency. Payment of a foreign currency leaves an exporter open to an exchange risk, e.g. an exporter may not receive full domestic currency value for an order if a buyer's currency has depreciated during the contract period. Moreover, it is unwise to accept payment in a currency that is not freely convertible on the foreign exchange market. The exporter may end up with blocked accounts or with funds saleable only at a considerable discount. Forward exchange market. An exporter can protect against any loss caused by fluctuating currencies during the sales contract period by taking out a forward exchange contract with a UK bank. The exporter, invoicing a buyer in a foreign currency for payment at an agreed future date, sells those expected receipts to a bank in advance (i.e. forward) of the due dale of payment. The bank agrees to buy at a predetermined forward rale of exchange which varies according to the time of future delivery, e.g. one, three or six months, or even longer. No money is exchanged at the time the forward contract is made, bul under its terms the exporter is guaranteed a certain amount of domestic currency in place of Ihe foreign currency sales proceeds, whatever fluctuations in the exchange-rale may take place between invoicing and payment by the buyer. The forward rale varies from the spot rale, i.e. Ihe rate the bank is prepared to pay for foreign currency at any moment of lime. The forward rale for selling Ihe foreign currency may be al a premium, i.e. il exchanges for more domestic currency lhan Ihe spol rale, or il may be al a discount if it exchanges for less. The difference between spol and forward rales is determined by market forces — the most impor- 204 205 tant of which is the difference in the prevailing interest rates being paid by banks f A fixed forward contract binds an exporter to delivering the required foreign currency to the bank on the date of maturity of the exchange contract. If the buyer defaults on payment or government controls are imposed on the currency payment, the exporter must still deliver the required foreign currency amount. The exporter must purchase the required amount of currency at the spot rate to close the forward contract. This could be expensive, since the rate of exchange used will be that applicable at the lime of the spot purchase. However, if the delivery of the currency is delayed beyond the maturity date then the forward exchange contract can be extended — but possibly at some extra cost, depending on the forward rate for this additional period. An exporter may still use forward exchange even when the date of payment by a buyer is in doubt, by entering into an option contract. Under this contract the exporter delivers the required amount of currency at a fixed rate at any chosen time between two agreed dates. Foreign currency borrowing. It is increasingly common for many exporters to raise finance in foreign currency. An exporter can eliminate exchange risk by taking a loan in the same currency as that to be paid by an overseas buyer, so that fluctuations in the exchange rate cannot affect the exporter's expected receipts from the buyer. Moreover, borrowing in a foreign currency may be cheaper than borrowing in sterling, depending on the relative interest rates prevailing. Bills drawn in a foreign currency can usually be negotiated by a UK bank in a similar way to sterling bills. Foreign currency loans can help the exporter develop international business, whether for capital expenditure at home, overseas acquisition or for export credit, including front-end finance. 206 Various types of Eurocurrency loans are available to finance export business. They include fixed-rale loans where borrowing costs are predetermined, or floating-rate loans where Ihe rale varies periodically according lo market rates. As menlioned previously ECGD can provide guarantees for foreign currency export contracls and large projects. Currency accounts. If an exporter has a continual flow of international business it may be preferable to open accounts in the currencies of the sales proceeds, instead of converling all of them into domestic currency. The various balances can then be used lo meel any expenses incurred in those currencies, while reducing commission fees incurred from dealings in the foreign exchange market. I Comprehension. Answer Ihe following questions:
tuating currencies?
207  9. Why is raising finance in foreign currency becoming popu- lar for many exporters?
II Comprehension. Complete the following on the basis of the information given in the text:
ible on the foreign exchange markets is . because the accounts may and the funds
10. There is no difference in negotiating by banks bills and those 11. Underlloating-rate loans borrowing costs according to Ill Study the examples of forward exchange, contracts and comment on the exporters gain and loss. EXAMPLE OF FORWARD EXCHANGE CONTRACTS WHERE THE EXPORTER IS EARNING DUTCH CURRENCY EXPECTED IN THREE MONTHS TIME a) Dutch guilders Guilders 10,000 to be received 5.00 Spot rale of exchange (bank's buying rale) Premium for 3 months forward (fixed) 2c 0.02 deduct from rate 4.98 £2,000.00 £2,008.03 8.03 Forward rate to be used Guilders 10,000 a 5.00 Guilders 10,000 a 4.98 Exporter's gain (equal to 1.6 per cent per annum) b) Dutch guilders Guilders 10,000 to be received 5.00 0.01 Spot rate of exchange (bank's buying rale) Discount for 3 months forward Ic - add to rale 5.01 £2,000.00 £1,996.01 £3.99 Forward rate to be used Guilders 10,000 a 5.00 Guilders 10,000 a 5.01 Exporter's loss (equal to 0.80 per cent per annum) 208 1619 209 EXAMPLES OF FORWARD EXCHANGE CONTRACT WHERE A US EXPORTER IS EARNING GERMAN CURRENCY EXPECTED IN 3 MONTHS TIME A. Deutschemarks al a premium 10,000 Deutschemarks to be received Spot rateof exchange (i.e. bank's buying rate) to$= 2.50 Premium for 3 months forward (fixed) bu I deduct 5pf from rale = 0.05 Forward rate to be used 2.45 Ueutschemarksl(),00()a2.50 = $4000.00 DculschemarkslO,OOOa2.45 = $4081.63 Exporter's gain (equal to 8.16 per cent per annum) = $81.63 B. Deutschemarks al a discount Deutschemarks 10,000 to be received Spot rate of exchange (i.e. bank's buying rate)  lo$... Discoun I for 3 mon Ihs forward — add 3 pf to rate.... Forward rale to be used = $4000.00 = $3952.57 = $47.43 DeulschemarkslO,OOOa2.50 Deutschemarks 10,000 a 2.53 Exporter's loss (equal Io4.74 percent per annum) man firm which wishes lo be paid in ils own , in which case you must convert inlo in order io pay a Ger man supplier. To prolect yourself against risk you can take out a exchange contract with an international bank for the amount of the particular currency expected from a sale. That means if you are selling goods lo a German customer with the price in Deutschemarks, you agree lo sell Ihose marks lo Ihe bank'on Ihe dale coinciding with Ihc of expecled paymenl by Ihe German buyer. In relurn you will receive from Ihe a fixed amounl in your currency on the exchange dale. The rale for Ihe forward contract varies depending on the period of lime you require lo deliver Ihc Deutsche marks. Whatever the period, Ihe of exchange is fixed by Ihe conlracl, under which you commit yourself to deliver lo the bank al some agreed dale a ccrlain amounl of Deulschemarks in ....... for you currency. IV Test. Fill in the missing words: Often buyers prefer lo be invoiced in their own and by agreeing lo this you may achieve more If you are operating^ the USA and sell goods lo a German buyer, you may be paid in You musl Ihcn convert the into on the foreign exchange market. You may also be pur chasing raw malerials or semi-processed goods from a Gcr- 210 |