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What can be done to close the global trade finance gap? BNY Mellon and GTR ask industry experts their views

Following the recent launch of its global survey, Overcoming the Trade Finance Gap: Root Causes and Remedies, BNY Mellon, in partnership with GTR, invited industry experts to take part in a virtual roundtable to examine and build upon the findings. The participants were Joon Kim – Global Head of Trade Finance Product and Portfolio Management, BNY Mellon Treasury Services; Maurice Iskandar – Assistant General Manager, Head of International Division, Banque Libano-Française; Olivier Paul – Head of Policy, ICC Banking Commission; Fernando Pierri – Global Head of Trade Services, Banco Santander Brasil; and Michael Lim – Head of Financial Institutions, Transaction Banking, ANZ.

To read the full article, please click here

 

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Why Southeast Asia’s global trade moment has arrived: BNY Mellon in Asia Outlook

Southeast Asia is not only thriving as a manufacturing centre, it is likely to  benefit hugely from China-U.S. trade tensions. In an article for Asia Outlook, Arnon Goldstein, Regional Head of Relationship Management APAC, and Joon Kim, Global Head of Trade Finance Product and Portfolio Management, BNY Mellon Treasury Services discuss how its banking sector will need to keep pace – and may need external help to leverage the potential opportunities.

To read the full article, please click here

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BNY Mellon discuss the results of their global survey into the trade finance gap in GTR

The global trade finance gap stands at a staggering US$1.5tn, according to latest figures. And to compound matters further, for many institutions, trade finance rejections are in fact increasing. Indeed, a new global report from BNY Mellon, “Overcoming the Trade Finance Gap: Root Causes and Remedies”, has found that trade finance rejection rates are rising in a third of the institutions surveyed.

In an article for GTR, Joon Kim, Global Head of Trade Finance Product and Portfolio Management at BNY Mellon Treasury Services, provides an outline of the results of the bank’s recent global survey on the trade finance gap – including what participants believe to be the most effective ways of narrowing the gap.

To read the full article, please click here

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S&P Global Ratings report considers the green credentials of telecom bonds, covered by the specialist press

As the green finance market continues to expand, new sectors such as telecommunications have started to issue green bonds and capitalise on investor demand for sustainable financial instruments, according to a recent report by S&P Global Ratings.

Labeled green bond offerings to date include three significant issuances by telecom giants Telefonica, Verizon, and Vodafone. But some investors have expressed concern that green bonds issued by telecom companies fund projects that could be described as “business as usual” and that lack environmental “additionality”.

In the report, S&P attempts to gauge the environmental contribution of the bonds issued in the sector thus far, issuing these bonds a score based on public information using its Green Evaluation analytical approach.

Following outreach by Moorgate, news of the report was covered by the following specialist press: Mobile Europe, Environmental Finance and Environmental Leader.

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Can Italy strike twice? S&P Global Ratings considers likelihood of Italy meeting latest renewable targets for Renewable Energy World

Earlier this year, Italy announced its plans to significantly increase renewables capacity by 2030. But what are the factors driving and impeding progress? S&P Global Ratings’ Stefania Belisario and Massimo Schiavo consider the answers for Renewable Energy World.

Italy boasts a track record of meeting renewables targets – but under different circumstances. As such, meeting the 2030 targets, though possible, is not without hurdles. Upcoming renewables auctions through 2021 are estimated at 7GW, meaning Italy may require levers beyond those scheduled to achieve their lofty ambitions.

Please click here to read the full article.

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ESG-based investing is here to stay, says S&P Global Ratings, covered by the specialist press

According to a recent report by S&P Global Ratings, executives and asset managers are in agreement that the rise of environmental, social, and governance (ESG)-based investing will likely accelerate as a younger, more values-oriented crop of investors enter the global markets.

Doug Peterson, S&P Global President and CEO, told attendees of  launch event for S&P Global Ratings’ ESG Evaluation tool, “Now more than ever, companies understand and have a much better appreciation of their responsibilities as corporate citizens. We see ESG matters as an essential component of sustainable company performance.”

Following outreach from Moorgate, the report was covered by Aqua Now, Wealth Adviser, SDG Knowledge Hub, and Institutional Asset Manager.

 

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Global debt at an all-time high – but banks don’t need to fret over corporate loans, writes Nina Brumma in Global Banking & Finance Review

Following Global Credit Data’s recent Loss Given Default (LGD) report, Nina Brumma, Head of Research and Analytics at Global Credit Data, explores what happens when a corporate defaults and how banks can manage the risk in Global Banking & Finance Review.

Despite a slow but steady remission from the global economic crisis at the end of the last decade, global debt has reached a record-breaking $237 trillion. As a result, the International Monetary Fund (IMF) voiced concern in its latest Global Financial Stability Report, stating, “the prolonged period of loose financial conditions in recent years has raised concerns that financial intermediaries and investors … may have extended too much credit to risky borrowers.”

This serves as a warning to banks and corporates, asking them to consider the consequences of corporates beginning to default on their debts. Especially with less familiar or riskier borrowers, it is therefore essential for financial institutions to seek collateral for their loans, and for the debt to take seniority if the borrowing body defaults. This maximizes the chances of a near-full recovery in the case of a default.

This said, Global Credit Data’s recent LGD report, which compiles statistics from over 50 member banks since 2000, reveals that, on average, banks recover 75% of defaulted corporate debt. And given that defaulted debt accounts for just 1% of the average bank’s loan book, it means banks recover a total of 99.75% of all corporate debt – before factoring in profit from interest payments and coupons. If a company has taken the right precautions, a bank can feel comfortable in a climate of low LGD.

For more information, read the full article here and the full report here.

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Credit risk, stranded assets and the environment: S&P Global Ratings’ Mike Wilkins contributes a chapter to a major new Routledge study

With ongoing advances in sustainability, the risk of being unable to monetise ca​r​bon assets grows by the day. A new book from Routledge, Stranded Assets and the Environment: Risk, Resilience and Opportunity, explores the ramifications of asset stranding across various sectors of the global economy.

Mike Wilkins, Head of Sustainable Finance at S&P Global Ratings, supplies chapter 8, drawing on research and real-world corporate case studies to focus on the credit implications of stranded assets.