Operational Risks:Trade Financing Has A Systems Impact Say Gen10

A recent conversation with Richard Williamson and Bruce Tozer of Gen10 around the topic of operational risks for commodity firms highlighted a number of areas impacting firms at the moment. One of these was trade finance and so this is part one of what will be a number of articles over the next several weeks on the theme of operational risks featuring those conversations with Gen10. Unsurprisingly, trade finance as it relates to commodities and commodity trading has been a topic garnering some interest and discussion in recent months. The industry has seen several banks announce that they are leaving the sector after making losses. Last summer, ABN Amro joined Natixis, BNP Paribas, Societe Generale, Rabobank, ANZ, and others who had decided to exit the trade and commodity finance business or freeze their activities there. Reporting significant net losses, ABN Amro said it was discontinuing its trade and commodity finance activities altogether. However, a whole set of scandals and defaults in the industry that came to light one after the other last summer was partly to blame for the bank’s revisiting of their trade and commodity finance business lines. “The net impact of all of this is an erosion of… continue reading

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