25/08/2023

Security of banks in trade finance: illusory as ever?

Michael Collett KC has written an article in the joint August/September edition of Butterworths’ Journal of International Banking and Financial Law on the illusory security of banks in trade finance.

Following the collapse of oil traders such as Hin Leong, Zenrock and Gulf Petrochem, there has been renewed focus on the security available to trade finance banks. In light of recent case-law, it can be seen that such security is often illusory.

Michael comments: “Earlier this year, Arvin Lee of Singapore firm Wee Swee Teow invited me to participate in a seminar at the National University of Singapore, Faculty of Law. I spoke about the issues with trade finance security which we had encountered in Credit Agricole v PPT Energy Trading and other cases.

“This article grew out of the presentation and seeks to provide an overview of the potential weaknesses in various forms of security in common use. The article reflects stimulating discussion of these questions with Mr Giam Chin Toon SC, Arvin Lee, Monique Wan and Mark Cheng of Wee Swee Teow LLP and the participants in the EW Barker Centre seminar.”

Read the article*.

*The full article was first published in the joint August/September edition of the JIBFL and is included here in its entirety with the publisher’s permission.