(ON DEMAND) Understanding Letters of Credit: Rules, Responsibilities & Liabilities

Email to Order Archived Webinar!

Letters of credit have been around for many years, but they remain a mystery to many financial institutions. Commercial letters of credit are commonly used to facilitate a purchase and sale transaction and generally are intended to be drawn on, while standby letters of credit are commonly used as back-up security that is rarely intended to be drawn on.

More recently, letters of credit are being used as a substitute for surety bonds, workers’ compensation insurance, construction contract bonding, governmental licenses, purchase price holdbacks, and environmental cleanup obligations. There is substantial liability and risk to financial institutions which issue letters of credit. This webinar will address the general rules under UCC Article 5 regarding all letters of credit, the Uniform Customs and Practice for Documentary Credits UCP 600 governing commercial letters of credit, and the International Standby Practices ISP 98 governing standby letters of credit.

HIGHLIGHTS
Overview of the parties involved in a letter-of-credit transaction
Responsibilities and liabilities of each entity associated with letters of credit
Comparison of commercial letters of credit versus standby letters of credit
Comparison of documentary letters of credit versus non-documentary letters of credit
Reimbursement agreements as replacements for “dummy” notes
Review of the rules under UCP 600, the ISP 98, and UCC Article 5
Recommended policies and procedures for issuing and accepting letters of credit

TAKE-AWAY TOOLKIT
Sample letter-of-credit policy
Employee training log
Quiz you can administer to measure staff learning and a separate answer key

Attendance verification for CE credits provided upon request.

WHO SHOULD ATTEND? Staff who needs to understand letters of credit and proper handling of letters-of-credit transactions. It is directed to staff involved in issuing, underwriting, processing, or accepting letters of credit.

ABOUT THE PRESENTER – Elizabeth Fast, JD, CPA, Spencer Fane LLP, a partner where she specializes in the representation of financial institutions. Elizabeth is the head of the firm’s training division. She received her law degree from the University of Kansas and her undergraduate degree from Pittsburg State University. In addition, she has a Master of Business Administration degree and she is a Certified Public Accountant. Before joining Spencer Fane, she was General Counsel, Senior Vice President, and Corporate Secretary of a $9 billion bank with more than 130 branches, where she managed all legal, regulatory, and compliance functions. She is a member of the Missouri State Banking Board by appointment of the Governor.