Chapter Ten


1. ‘Unrealised’ since the gain or loss would crystalise only if the bank decides to sell the bond in the market at that value.

2. Both the terms ‘money market’ and ‘commercial paper’ are being explained subsequently in this chapter.

3. More discussion on these products will be found in the chapter on ‘International Banking’.

4. The bank stamps the word ‘accepted’ on the face of the instrument.

5. Letters of credit (LCs) are documents governed by the rules of the International Chamber of Commerce (ICC). These documents stipulate contract terms and duties of parties to the LC (the importer, exporter and the participating banks) and authorises the exporter to draw a draft on a participating bank for payment to be received from the ...

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