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After $9 Billion Credit Hit, Banks Seek Trade Finance Revamp

  • HSBC, ING, ABN among banks saddled with potential loan losses
  • Lenders counting on technology, diligence to detect fraud
Views of Singapore as Prime Minister says Covid-19 to ‘Weigh Heavily’ on City-State's Economy
Photographer: Wei Leng Tay/Bloomberg
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When Credit Agricole SA and HSBC Holdings Plc issued a payment guarantee for a $76.5 million fuel purchase from a Singapore trader in March, they unwittingly became the latest victims in a series of trade finance scandals that have led to more than $9 billion in potential losses for global lenders.

At the same time that Hin Leong Trading Pte. was pledging the fuel to back the loan, it allegedly agreed to sell the same cargo to another trader, who sought letters of credit from three banks including Credit Agricole.