Press Releases

Currency Agnostic Blockchain Debuts for Global Trade

Commodities purchases worth around $43 million from Peru under the initiative of Mitsubishi Corporation (Americas) were made over multiple transactions using Skuchain’s currency agnostic blockchain for digital trade assets, which were used for payment through Mizuho Bank.

MOUNTAIN VIEW/SINGAPORE/TOKYO — Metal commodities worth around $43 million were purchased from one of the largest mines in Peru under the initiative of Mitsubishi Corporation (Americas). The purchases were made over multiple transactions using Skuchain‘s currency agnostic blockchain for digital trade assets that were used for payment through Mizuho Bank.

The digital asset issued by the buyer was a Distributed Ledger Payment Commitment (DLPC), a digital negotiable instrument with a full-fledged legal framework published by BAFT (Bankers Association for Finance and Trade), the largest trade association for transaction banking.

Skuchain’s blockchain managed the lifecycle of the digital asset from issuance to discharge and triggered secure payment instructions to Mizuho. This makes open account trade transactions frictionless and with a similar level of security as Letters of Credit, Guarantees and other traditional trade instruments, at a reduced cost.

Mitsubishi Corporation (Americas) appreciated the precise control this provides the company over its counterparty payments and seeks to expand the usage of blockchain managed DLPCs to underwrite its own transactions as well as encourage its customers to replace current trade finance instruments with the DLPC. By placing control over trade finance arrangements squarely in the hands of the enterprises that need it while tapping into vast pools of capital at banks and other financial institutions gives the company more liquidity and trading capacity.

“People have talked about Blockchain and supply chain for at least 5 years. We just moved past the talk stage to actually move thousands of tons of a physical commodity across 10,000 miles backed by bank-acceptable digital assets worth $43m on our blockchain and we did it faster, cheaper, and more secure than what came before,” said Srinivasan Sriram, Founder and CEO at Skuchain.

“We are very honored to collaborate with Skuchain and Mizuho Bank to conduct the first DLPC transactions in real trading. We would like to continuously pursue further opportunities to apply DLPC to provide better services to our customers and partners,” said Yuichiro Yoshinari, Director, Innovation and Design Thinking at the Silicon Valley Branch of Mitsubishi Corporation (Americas).

“We are honored to have conducted the first DLPC transactions with Mitsubishi Corporation (Americas) and Skuchain.  We would like to accelerate the improvements in our ability to provide services to meet customers’ diverse needs by utilizing cutting-edge technologies in trade finance,” said Yoshisuke Maeda, General Manager at Mizuho Bank, Global Transaction Banking Department.

Tod Burwell, President & CEO, BAFT stated “Digitization of trade requires standards as well as supporting legal framework.  We were delighted to work with our members to develop the DLPC for this purpose, and even more excited that this has been successfully put into practice to facilitate live transactions.”

About Mitsubishi Corporation (Americas) and its Silicon Valley Branch
Mitsubishi Corporation (Americas) is a wholly owned subsidiary of Mitsubishi Corporation, a global integrated business enterprise with 10 business groups that operate across virtually every industry. These include natural gas, industrial materials, petroleum and chemicals, mineral resources, industrial infrastructure, automotive and mobility, food, consumer, power, and urban development. The Silicon Valley Branch, which led this project, is an innovation hub that scouts and tests new technologies and startups to lead the company’s digital transformation. Learn more at https://www.mitsubishicorp.com/northamerica.

About Skuchain
Skuchain provides enterprises and banks a currency agnostic blockchain for global trade. Its platform powers value chains that leverage data and capital to achieve optimal resilience and flexibility. Skuchain’s solutions have been adopted across mining and minerals, food and agriculture, electronics, auto and finance in Asia, Europe and the US. Learn more at https://www.skuchain.com.

About Mizuho Bank
Mizuho Bank, Ltd. is a leading global bank with one of the largest customer bases in Japan, and an extensive international network covering financial and business centers around the world. Learn more at https://www.mizuhogroup.com/.

About BAFT
BAFT is the leading international financial services association whose membership includes large global and regional banks, service providers, and fintech companies headquartered around the world. BAFT provides advocacy, thought leadership, education, and a global forum for its members in transaction banking, including international trade finance and payments. For nearly a century, BAFT has expanded markets, shaped policy, developed business solutions, and preserved the safety and soundness of the global financial system.

BAFT and Afreximbank Deliver Virtual Training Workshops on Correspondent Banking in Africa

BAFT and the African Export-Import Bank (Afreximbank) announce the launch of a series of training workshops for African respondent banks to enhance their ability to obtain and maintain correspondent banking relationships.

CAIRO/WASHINGTON – African Export-Import Bank (Afreximbank) and BAFT today announced the launch of a series of training workshops for African respondent banks to enhance their ability to obtain and maintain correspondent banking relationships.

The first round of workshops, to be held virtually July 27-29, 2021, is primarily geared toward compliance and risk management staff, as well as transaction banking business line and credit officers from private sector and central banks across Africa.

In the current context where access to correspondent banking services is becoming increasingly costly due to heightened regulatory expectations, particularly in relation to Anti-Money Laundering and Counter Terrorism Financing, the three-day training sessions will provide an overview of important elements to be considered by respondent banks when establishing new correspondent banking relationships. Attendees will participate in in-depth discussions on respondent best practices for due diligence, maintaining relationships, and working with money service businesses and fintech companies.

Afreximbank has identified BAFT as a strategic partner in this initiative, utilizing the BAFT Respondent’s Playbook, the industry leading approach to capacity building.

“We are thrilled to launch such an important capacity building initiative in cooperation with Afreximbank in markets deeply affected by correspondent banking de-risking,” said Tod Burwell, BAFT President & CEO. “We hope that participants gain new knowledge and insight on ways to strengthen relationships with correspondent banks.”

“As part of Afreximbank’s Correspondent Banking and Trade Services Strategy, we have been supporting banks in our member states to have access to international banking market by providing them with trade finance lines and Advisory Services. Improving the capacity of African banks to enable them to access correspondent banking services is also key part of our mandate and capacity building is a major activity in this regard,” said Denys Denya, Afreximbank’s Executive Vice President in charge of Finance, Administration and Banking Services.

About Afreximbank

African Export-Import Bank (Afreximbank) is a Pan-African multilateral financial institution mandated to finance and promote intra-and extra-African trade. The Bank deploys innovative structures to deliver financing solutions that support the transformation of the structure of Africa’s trade, accelerating industrialization and intra-regional trade, thereby boosting economic expansion in Africa. At the end of 2020, Afreximbank’s total assets and guarantees stood at US$21.5 billion, and its shareholder funds amounted to US$3.4 billion. The Bank disbursed more than US$42 billion between 2016 and 2020. Afreximbank has ratings assigned by GCR (international scale) (A-), Moody’s (Baa1) and Fitch (BBB-). It is headquartered in Cairo, Egypt.

For more information, visit: www.afreximbank.com.

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About BAFT

BAFT, the leading global financial services association for international transaction banking, helps bridge solutions across financial institutions, service providers and the regulatory community that promote sound financial practices enabling innovation, efficiency, and commercial growth. BAFT engages on a wide range of topics affecting transaction banking, including trade finance, payments, and compliance.

To learn how your organization can access BAFT’s Respondent’s Playbook Training or for additional training or educational topics, please email [email protected].

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BAFT, Trade Finance Groups Launch Report on Impact of LIBOR Transition

New report provides insight on the impact of LIBOR transition for banks and corporations in the trade finance industry.

WASHINGTON — BAFT, the leading global financial services association for international transaction banking, in collaboration with TXF Intelligence and Baker McKenzie today announced the publication of No More LIBOR: What Next for Trade Finance? This report explores the impending impact the cessation of LIBOR will have on trade finance. Using a mixed methodology that combined quantitative survey responses with detailed qualitative insights from banks and corporations between February and May 2021, this report sheds light on the industry’s transition priorities in the months leading up to LIBOR’s cessation.

“The goal of this research is to present the latest market trends surrounding the impending cessation of LIBOR across trade finance,” said Tom Parkman, head of research, TXF Intelligence. “The data presented provides an insight into prevailing sentiments across parts the banking and corporate world this critically important issue – research which to date, does not exist in the trade finance industry.”

The transition away from LIBOR will have a deep impact across the suite of trade finance products. In 2019, global trade flows totaled $18.1 trillion, with an estimated $9.77 trillion of that sum comprised of bank intermediated trade. Corporations surveyed in this research have reportedly made very little progress to successfully transition all of their LIBOR-linked exposures to a suitable alternative rate. Banks surveyed continue to stress the importance of transitioning to term rates for all currencies, but especially for U.S. Dollar. Banks cited the uncertainty and lack of clarity around the availability of term rates across currencies as a roadblock to effectively communicating a transition plan with corporate clients. Regulatory efforts are being made in the U.S. to assist the availability of the Term SOFR rate and more progress is expected soon. For example, on July 21, the Alternative Reference Rates Committee recommended conventions and use cases for employing the forward-looking Secured Overnight Financing Rate (SOFR) term rates that are expected to be formally recommended by the ARRC in the coming days.

“While LIBOR transition has often been regarded as a ’bank problem,’ banks tread a fine line between educating borrowers who may be less familiar with the issues around LIBOR transition and providing advice,” said Luka Lightfoot, partner, banking and finance, Baker McKenzie. “It is important that corporates and banks engage with each other to come to mutually acceptable solutions to the LIBOR transition challenge.”

“Banks should continue to track currency-specific transition deadlines, intensify internal system and process preparations, and enhance and tailor communication with corporate clients,” said Diana Rodriguez, vice president, international policy, BAFT. “Taken together, these steps will help to ease some of the uncertainty and pave a more solid path toward transition.”

To read No More LIBOR What Next for Trade Finance?, click here.

To read BAFT’s other resources on navigating the transition, click here.

BAFT Media Contact:
Blair Bernstein
Director, Public Relations
[email protected]
+ 1 (202) 663-5468

Trade Digitization in A Post-Pandemic World

New BAFT whitepaper analyzes the state of trade digitization at the end of 2020, the progress made during the COVID-19 pandemic and highlights necessary actions to ensure continued advancement

WASHINGTON – BAFT, the leading global financial services association for international transaction banking, in collaboration with the International Chamber of Commerce (ICC) and the International Trade and Forfaiting Association (ITFA) today announced the publication of a new whitepaper, Progress on Trade Digitization 2021. The whitepaper analyzes the state of trade digitization at the end of 2020, highlights progress made during the COVID-19 pandemic and proposes additional changes to ensure digitization’s continued and sustainable advancement.

According to a 2020 ICC Annual Survey, 54% of respondents revealed they introduced new digital solutions to address difficulties posed by COVID-19. These digital initiatives took various forms, including mobile network providers reducing fees, governments raising contactless limits to reduce in-person cash transactions and increased daily and monthly limits for users.

“While these digital developments in the wake of COVID-19 were incredibly helpful, our ultimate goal is to make positive changes that are sustainable long-term,” said Stacey Facter, senior vice president, trade products, BAFT. “To do that requires a legal environment that allows for digital documents to scale, as well as a global adoption of the standards in place today and continued support for those still under development. These are critical factors in maintaining the forward momentum of digitization.”

“The arguments in favor of digitization have been accepted by the majority of the world’s biggest trading nations but implementation still remains a work in progress,” said Sean Edwards, chairman, ITFA. “Fortunately, we possess the tools and resources to make this happen and the pace of change can be very quick with the right support.”

The whitepaper highlights six countries as case studies in how governments can implement reforms that harmonize their domestic legal frameworks with UNCITRAL’S Model Law on Electronic Transferable Records.

It also discusses the need for cross-industry, cross-technology platform-based standards to improve the effectiveness and efficiency of digital trade. The paper offers examples of standards available today and encourages stakeholders to consider how they can leverage them. For those interested in going a step further, the paper suggests participating in the creation of global standards through the DSI.

To read Progress on Trade Digitization 2021, click here.

BAFT Media Contact:
Blair Bernstein
Director, Public Relations
[email protected]
+ 1 (202) 663-5468

BAFT Releases FAQ on LIBOR Transition, Impact to Trade Finance

New report provides guidance and information on LIBOR transition for trade finance industry

WASHINGTON — BAFT, the leading global financial services association for international transaction banking, today announced the publication of the first edition of LIBOR Transition: Impact on Trade Finance – Frequently Asked Questions Guide to inform and respond to frequently asked questions related to LIBOR transition for U.S. Dollar and UK Pound Sterling.

Trade is essential to GDP growth and supports commercial flows and supply chain sustainability globally. In 2019, global trade flows totaled $18.1 trillion, with an estimated $9.77 trillion of that sum comprised of bank intermediated trade. USD LIBOR is the most widely used benchmark across the trade finance industry globally. As the market prepares to transition away from LIBOR to Risk Free Rates (RFRs) by the end of 2021, BAFT member institutions have been working steadily to prepare for the change.

“This frequently asked questions guide provides timely information for trade finance practitioners who are preparing for the transition away from LIBOR,” said Diana Rodriguez, vice president, international policy at BAFT. “The trade finance business has long stressed the imperative for a forward-looking term rate to ensure the uninterrupted provision of financing to support cross border trade. We were pleased to see the development of Term SONIA in the UK which forged a clear path for the industry to transition. In the U.S., we are awaiting and closely tracking the ARRC’s plans to formally endorse a SOFR Term Rate and are evaluating the viability of other term rates solutions for the U.S. Dollar.”

The BAFT guide is the culmination of several months of analysis by the BAFT IBOR Transition Working Group, as well as active engagement with vendors providing term rate solutions for the U.S. Dollar. Trade finance practitioners are encouraged to work internally with LIBOR transition teams to review documentation carefully to determine what elements of the portfolio and services reference LIBOR or other IBORs that will cease and what fallbacks would apply when the rate becomes unavailable. This resource will be updated regularly as new official sector guidance emerges and to reflect emerging BAFT working group best practices. Future iterations of this guide will consider transition priorities for other important currencies for the trade finance business.

To read the LIBOR Transition: Impact on Trade Finance – Frequently Asked Questions Guide, click here.

Read the full guide here.

BAFT Media Contact:
Blair Bernstein
Director, Public Relations
[email protected]
+ 1 (202) 663-5468

BAFT Congratulates Graduates of the 2021 Future Leaders Program

The Class of 2021, comprised of 36 individuals from 26 countries, were recognized today during BAFT’s 2021 Virtual Global Annual Meeting.

WASHINGTON – BAFT, the leading global financial services association for international transaction banking, today announced the graduates of its Future Leaders Program class of 2021. The program – now completing its sixth year – recognizes upcoming leaders in the global transaction banking industry. The Future Leader graduates were honored during a virtual ceremony as a part of BAFT’s 2021 Annual Global Meeting.

Nominated by their respective institutions, the class of 2021 included 36 individuals from 21 countries across six continents representing a variety of disciplines within transaction banking. This year’s group was divided into five project teams to address current industry issues including transaction banking post COVID-19, commodity trade finance, sustainable finance, faster payments, and diversity, equity and inclusion.

“We are incredibly proud of this year’s graduates, which represent the largest and most geographically diverse Future Leaders class since the inception of the program,” said Tod Burwell, president and CEO, BAFT. “Despite the challenging circumstances, program participants were engaged and collaborative, and ultimately delivered projects that will enrich the transaction banking industry.”

The Future Leaders research papers are available for all BAFT members online here.

BAFT congratulates the following graduates from the Class of 2021.

  • Hanan Hassan Moalim Ali, International Islamic Trade Finance Corporation
  • Yaseen Alsharif, Arab Bank
  • Hanna G. Atallah, Housing Bank for Trade and Finance
  • Linda Bader, Wintrust Financial Corporation
  • Boris Bajic, Danske Bank
  • Thomas Banks, Lloyds Banking Group
  • Ahmed Bayoumi, Export Development Bank of Egypt (EBE)
  • Clement Berthou, Societe Generale
  • Caroline Brown, Wells Fargo Bank
  • Bruno Campos, Bank of America
  • Antonio Crespo, Nordea
  • Alexia Dackberg, Swedbank
  • Madlena Demirchian, Commerce Bank
  • Natalie Harold, NatWest
  • Christophe Hatt, BNP Paribas
  • Aaron Jennings, BNY Mellon
  • Elmira Jubanyshkaliyeva, Barclays
  • Mukuka Bwalya-Katowa, FNB Zambia
  • Zakir Khanmammadov, Kapital Bank
  • Rufus Kin Yan Lam, HSBC
  • Ryan Lastra, JPMorgan Chase & Co.
  • Thao Hanh Le, ING Bank
  • Yvonne Lim, UBS
  • Aline Perico Lime, StoneX
  • Sepideh Malekpour, Surecomp
  • Jocelyn Tong-Palmer, ANZ Banking Group
  • Pauline Pang, MUFG Bank
  • Rachel Parks, Derivative Path, Inc.
  • Abir Paul, BMO Capital Markets
  • Sara Pianigiani, Standard Chartered
  • Grzegorz Pojnar, Santander Bank
  • Joshua Randolph, PNC Bank
  • Theresa Donnelly-Staerk, Deloitte
  • Xi-Ping Tan, Deutsche Bank
  • Ruben Valentino, Banorte
  • Mouli Vasan, Abu Dhabi Commercial Bank

About BAFT
BAFT is the leading international financial services association whose membership includes large global and regional banks, service providers, and fintech companies headquartered around the world. BAFT provides advocacy, thought leadership, education, and a global forum for its members in transaction banking, including international trade finance and payments. For nearly a century, BAFT has expanded markets, shaped policy, developed business solutions, and preserved the safety and soundness of the global financial system. Learn more at www.baft.org.

BAFT Media Contact:
Blair Bernstein
Director, Public Relations
[email protected]
+ 1 (202) 663-5468