Analysis Of BP Risk Under DC

With joining the WTO and the rapid development of China’s international trade, import and export volume of China’s trade also will continue to increase, showing a rising trend, and the total trade share accounted for GDP has been becoming more and more growing, So the trade financing business get more and more favour of both sides of trade and commercial banks, and also are increasingly used in the import and export trade. International trade financing business development of most commercial banks tend to be stable, and become the main form of bank to obtain high profits. And the L/C is the import and export enterprises in foreign trade activities of the most commonly used method of payment, and play a vital role in China’s foreign economic and trade. Banks make high profits through trade financing business, at the same the trade financing for its risk of loss to the bank is becoming more and more great. In terms of the current domestic and foreign economic situation, the diversification of trade financing, letter of credit financing business also innovation, and letter of credit financing in trade financing make up a great proportion, the risk also will be presented. So the commercial banks in order to prevent the risk of losses by the letter of credit financing, it is necessary to analyze its risks, and when the banks handle the credit financing business as far as possible to reduce or avoid the losses.Export bill purchase refers to the exporters by the issuing bank of the L/C and after shipment, as requested in the L/C documents, a full set of cargo documents pledge to the local bank (the negotiating bank), after the bank deduct trade interest and related expenses will be payment for goods to pay the beneficiary in advance, and then claim to recover the payment from the issuing bank, or in transit financing provided by the bank to the exporter. Although export bill purchase its less risk relative to other financing methods, payment is guaranteed. But as a kind of financing method, there are still quite a risk. Although export bill purchase for such a letter of credit financing relative to other financing is less risk, the payment is also guaranteed, as a kind of financing, will also bring losses to the bank, there are still some risks. So the banks must be in-depth analyze the risks and the risk prevention measures when they handle the export bill purchase.In this paper, according to an example of Z bank, to export bill purchase as the research object, and to combine a specific case to analyze. From the perspective of the Z bank, to analyze the Z bank to handle the letter of credit financing business what risks and problems which may be produced, and suggesting Z bank in the future need to review before the export bill purchase and track after, so that the overall quality of the person in this business has increased, to prevent the loss of export bill purchase from the risks, and put forward relevant suggestions to avoid, as far as possible to reduce the risks of export bill purchase business.