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The Daily ITK Discussion Thread - 14th August 2012

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wishkah

Well-Known Member
Jan 27, 2011
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Kendall said:
I would expect so. Our accounts are out in the open, so for a letter of credit to be used, you'd have to think this is meaty.
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or the destination of the funds requires it...who knows.

i'm on the FX side so i'm just one part of a "deal team". the Corporate Bankers bang on about how/what is going on..then they ask me if i'm able to cover the fx risk. i will make it v. clear i don't know the destination or the size, just that one was being prepared....

as some of you smart people state, why would we prepare it if not to issue it....good points all round
 
spurslenny

spurslenny

I hate football
Nov 24, 2006
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Breezer said:
Ok I logged out for the last 1-2hrs and now I'm lost! Wtf are you lot saying? I need a breakdown in basic English :) . What's being prepared? For who? And when?
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We are about to spunk a shit load of cash on a shiny new striker*







*in my mind anyway
 
Gaz_Gammon

Gaz_Gammon

Well-Known Member
Apr 16, 2005
16,047
18,013
So do you think, if we'd signed Adebayor before the season started we'd have won 4-3 and 6-5 in those two games ?
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Hindsight..............such a charming and fullfilling gift for one to have.
 
Dare!

Dare!

Well-Known Member
Jan 20, 2011
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Guys, I just saw Leandro and the Internacional chairman collecting a big bag of money from my local Barclays branch. Don't ask how I know what the chairman looks like.
 
bigpalacios

bigpalacios

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Jun 7, 2009
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wishkah said:
near enough spot on,

getting away from the details of how it works, its more to do with credit ratings (as a bank's is better than a clubs) and guarantee of payment / the removal of risk.

i don't want to stoke a fire suggesting international nature and size of payment....i don't know as these things can be pretty standardised for anything.

what i would like to expand on, in another topic avec Stoof is how these are used in conjunction with invoice discounting (for either buyer or seller) which makes the merry round spin. aka we recieve money for modders, discount it with bank A, bank A is sure of funds / no risk on spurs, which allows spurs to go off and spend elsehwere. As we don't have the funds, but the bank A has covered the clubs position through the invoice discount, we can offer money we dont have yet in the form of a letter of credit, which is issued again by bank A....thus risk is removed from all angles from the clubs point of view, and we leverage Bank A's products to initiate trade.

sorry if i've made this a little hard to get heads round.
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Stoof

Stoof

THERE IS A PIGEON IN MY BANK ACCOUNT
Staff
Jun 5, 2004
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Kendall said:
You would've thought that a prepared letter of credit must mean a deal is some way down the track, especially when you consider the speed some of these deals are done on deadline day. Whilst not issued, you have to assume a bid was lodged, accepted and terms finalised subject to confirmation from the bank of funds.
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My point was this is not me saying "I'll give you a tenner for that bottle of wine". It's me reaching for my wallet to get a tenner out to give to you as the agreed price for the bottle of wine.
 
V

VincenzoCoccotti

Well-Known Member
Oct 22, 2011
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Not getting too excited, yet

Would the LOC definitely be for a player? surely it could also be something to do with the stadium as that is an expensive project
 
N

noahrobert

Active Member
Jan 27, 2011
521
403
sunnydelight786 said:
Would I be right in thinking a LOC is issued/used only for large sums of £...?
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No so. If say you were puma and you were selling 100 pairs of trainers to a sports shop in Spain, due to Market conditions this would need a LOC at minimum as the country as a whole has not got a great credit rating.

It is generally used in import export, but the fact a letter has been prepared means either this letter will confirm the contract, or seal the deal.

However if it was a huge amount, I could see the necessity even with a good credit rating and Market rating (country of buyer)

This looks like good news fella's!!!!!!
 
P

punky

Gone
Sep 23, 2008
7,485
5,403
Sorry I'm trying piece this together on my phone.

The club has asked one of our members to write a letter of credit, which Stoof is also involved in somehow, to support a large bid we have made against another player?

Is that about right?
 
samspurs92

samspurs92

Well-Known Member
May 17, 2010
2,107
7,486
punky said:
Sorry I'm trying piece this together on my phone.

The club has asked one of our members to write a letter of credit, which Stoof is also involved in somehow, to support a large bid we have made against another player?

Is that about right?
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Can we have a Party Pooper rating?
 
spurslenny

spurslenny

I hate football
Nov 24, 2006
7,545
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Maybe it's for AVB's payoff.

Zero points!!!!! You're shit Andre! Clear out your locker asap!
 
Mr Pink

Mr Pink

SC Supporter
Aug 25, 2010
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noahrobert said:
Yes, I used to work for BTR group doing all their sales export insurance using NCM Cardiff as insurer. Due to being a huge account NCM used to allow us certain discretion.

At the time Spain was in turmoil (1992) and much of the Trade needing a ILOC, or CILOC due to credit rating.

In export terms I think it's down to the contract and credit rating not just of the buyer but by the country if as a whole is not keeping up to date on import payments.

A letter of credit usually means that the sale itself is a contract but in terms of regular business import export normal businesses use standard 30/60/90 day terms.

I think letter of credit means that the bank has confirmed the funds are available and the bank writes to the seller confirming this, but not confirming the contract.

Irrevocable letter of credit means that the funds are ringfenced by the bank and the letter if credit are then part of the contract as in it can't be pulled out from.

Confirmed ILOC is when the bank guarentees the payment in event of anything going wrong and is again part of the contract.

Been about 20 years since I was involved but is definately to do with export/import payment terms.

Agreed if a letter of credit has been drawn up it would suggest to me, that a firm bid has been agreed, and this would be part of the, you can definately afford this confirmation. Wouldn't be drawn up just for a bid, as it it something that generally confirms a contract not a bid. In that business they are not drawn up for purely we may buy this, or may not. Terms are usually agreed before this stage.

Good finding and posting Wishkah!!!
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Well that's definitely what I would of thought, sounds very logical to me.
 
Stoof

Stoof

THERE IS A PIGEON IN MY BANK ACCOUNT
Staff
Jun 5, 2004
32,221
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punky said:
Sorry I'm trying piece this together on my phone.

The club has asked one of our members to write a letter of credit, which Stoof is also involved in somehow, to support a large bid we have made against another player?

Is that about right?
Click to expand...

Hehe.

I'm only involved as an article writer. I'm a bit of a geek for this sort of stuff and am writing a note on this to put on the site.

It seems we're gearing up for our Bank to guarantee to pay someone else's Bank some money.

Whether that's for a player or a lot of kit from abroad - who knows?
 
brasil_spur

brasil_spur

SC Supporter
Aug 25, 2006
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Bus-Conductor said:
So do you think, if we'd signed Adebayor before the season started we'd have won 4-3 and 6-5 in those two games ?
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:rolleyes:

NO.

My point, if you bother to read it properly, is that the two games we have at the start of THIS season could be crucial come the end of this season and by not getting in Adebayor, or another striker, before them we could end up in the position whereby had we bought a striker in before this new season started we would have made CL.

I don't want to re-write history, i just want us to look at what lessons we can learn from it and improve.
 
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