Letter of Credit at sight
A bank undertaking to pay against presentation of documents that comply with the credit. Every condition should be operationally clear before shipment.
Payment structures must protect commercial interests without creating documentary conditions that cannot be performed.
A bank undertaking to pay against presentation of documents that comply with the credit. Every condition should be operationally clear before shipment.
Commercial and transport documents are handled through banking channels, but without the same independent bank payment undertaking as a documentary credit.
Appropriate only where credit approval, transaction history, limits and risk controls support the exposure.
A buyer LC can support working-capital efficiency, but it does not automatically eliminate Moorgate's cash-margin, collateral, discrepancy, performance or funding obligations. The issuing/financing bank determines the actual facility.
A documentary credit can address defined payment risk, but it does not by itself remove commodity-price, basis or foreign-exchange exposure. Pricing dates, shipment milestones, documentary presentation, funding and hedge cash flows should therefore be considered together.
For LME-linked physical trades, commercial pricing, FX exposure and financing timing should be considered together. Moorgate can support this transaction-level risk analysis while regulated hedge execution, where required, is undertaken through appropriately authorised counterparties.