2024 Singapore Annual LC Survey • Executive Summary

For the 25^th consecutive year, the Institute of International Banking Law & Practice conducted its Annual LC Survey conference for the Singapore LC market. Held on 9 May 2024 and hosted by Baker McKenzie, the program was organized as a hybrid event, permitting attendees to join in-person or virtually.

2024 News & Trends in Global Trade

In a troubling paradox, one LC specialist noted that criminals are continuing to utilize letters of credit for fraudulent purposes while LC use is declining among reputable companies who are instead seeking forms of pre- and post-financing more than ever. Another specialist countered that LCs reflect what’s happening in the world and in wartime there is need for the LC as a risk mitigating device. They are seeing an increase from corporates for confirmed LCs from the export side.

From an operations perspective, the ratcheting up of regulatory expectations (vessel tracking, price checking, etc.) is vexing. This has led to lengthy LCs with sanctions clauses and increased reliance on letters of indemnity (LOIs). One experienced manager acknowledged that AI is here to stay and urged bankers to embrace AI as a means of coping with regulatory expectations.