We are HK exporters from yarn to Bangladesh. Last July we exported a container on L/C 90 days B/L date.

Apparently this L/C was opened to us following a back-t-back structure (this is not mentioned in our L/C text though). Issuing bank was a local bank in Bangladesh. The L/C was not confirmed. After a few days the issuing bank confirmed reception of documents. The buyer raised no discrepancies, the documents were handed over to the buyer and he took the goods from port. At the same time the bank agreed payment to mature end of October (they sent SWIFT message for this payment confirmation). Everything was consistent with the B/L shipping date and looked ok. After the maturity date of the payment 10 days passed but the bank did not pay. Our bank in HK (very big and reputable) sent several messages to issuing bank to ask for immediate payment; after this our bank did not receive any reply so far. What do you think? What can we do? Is this normal? Thanks in advance for your reply. Air waybill Non Negotiabledescription of goods as per invoice Top

Sun, 03/28/2010 - 03:50

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Sat, 11/08/2008 - 03:19

#2 shahriar Offline Joined: 08/25/2007 Posts: this is not normal dear jorge,

Since the LC was a BTB one, the only thing I can imagine is that the issuing bank is yet to receive payment against the master LC. As a result the bank needs to create a force loan and that often takes upto 10 days. Usually bank initiates the loan process 1 week before the maturity of the BTB LC. Delaying the payment of any LC by more than 5 days is not acceptable and abnormal. The central bank of Bangladesh is very strict on this issue.
regd Shahriar

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Sat, 11/08/2008 - 22:51

#3 jorgesaurio Offline Joined: 11/07/2008 Posts: i hope so thanks for your reply. i am very worried and i hope that finally the bank will pay within a few days. i will let you know

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Tue, 11/11/2008 - 07:28

#4 Hmmm Offline Joined: 08/20/2007 Posts: Dear Jorgesaurio, I'm

Dear Jorgesaurio, I'm pretty sure you will receive a payment in a month or two. Our sight complying presentations under LCs are honoured by Bangladeshi banks in some 2-6 months periods, we got used to it. Their bankers are totally illiterate in LCs, but there is nothing could be done in this situation. Maybe ICC could take a lead in arranging more seminars to them. Best regards

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Fri, 11/14/2008 - 04:01

#5 jorgesaurio Offline Joined: 11/07/2008 Posts: Hello Hmmm, could you give Hello Hmmm, could you give me some more information about your past experience dealing with Bangladesh banks with LC? i am really anxious and i am a bit reluctant to just "wait and see". Is there any thing that could be done? File a complaint in the Bangladesh central bank? in the ICC? thanks in advance

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Tue, 11/11/2008 - 10:44

#6 iLC. Offline Joined: 11/07/2008 Posts: is it? i have pretty good is it? i have pretty good experience with them. there may be some problem with some lower rated bank. i once got a payment from germany after 4 months. for this i can not call them illiterate. or can i?

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Fri, 11/14/2008 - 01:14

#7 jorgesaurio Offline Joined: 11/07/2008 Posts: Thank you for all your Thank you for all your comments. So far we have not got any money and the bank from Bangladesh doesnt reply to any swift messages that our bank send to them. This is not L/C literacy, this is bad faith. Up to this point i dont know whether we will finally get the money or not. I am really amazed that the bank confirmed the payment date and the amount via swift and did not pay. This is not that bank found discrepant documents and made the process dirty and slow, we are talking that the bank gave the goods to the customer and confirmed the payment in date and amount but did not honour the payment and dont reply our messages. The only piece of advice i learnt and i can give to you is NEVER EVER work with Bangladesh customers, only accept 100% prepayment in advance. If they can not honour the contracts is better they dont do business. We are even talking about banks not honouring payment dates, is the last resort of trust you can have in a country, and even this fails. i will let you know the final result, Best regards, Jorgesaurio PS. The bank name is NATIONAL BANK LIMITED

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Fri, 11/14/2008 - 04:45

#8 ImranUmer Offline Joined: 12/30/2007 Posts: Bangladesh Dear Jorgesaurio,

I wish you can get your money soon. Have you approached the Central Bank in Bangladesh? or have you approached any Business / Trade Organization in Bangladesh thru yours? Secondly, force your bank to send some bold message to Bangladeshi bank, either Pay the bill amount alongwith interest amount or get ready for some legal actions. I believe, your bank must play their role, rather they just sit and get relaxed. My best wishes are with you. Imran Umer IamImranUmer@gmail.com

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Sun, 11/16/2008 - 22:40

#9 jorgesaurio Offline Joined: 11/07/2008 Posts: payment Yesterday, on Sunday, we were talking to the bank in Bangladesh. Explaining the serious consequencees of this non-payment. The promised they had already paid and they showed us a fake swift MT202 (payment order). We identified it as a message still pendent to be sent to the system, it was just in "standby" (The showed us a copy paper of a swift message where the 'status' field in the message was "fuzzy", they just made the paper unreadable but they said the message had been already released, something that was not true). After this explanation and our more strong position they finally released the message to the swift system and this morning in HK our bank advised we got the money in the account. They kept the money for 3 weeks and i am 100% sure that if we dont show our strong position yesterday we would have waited long long time to see the money, a few months like somebody before mentioned in this thread. Our learning point is that we will never again will work with this kind of banks; moreover, in this deteriorated economic situation we need to be more careful than ever and avoid this kind of risky situations at all. Some of my friends in the same industry already advised us about these situations, now we experienced it in our flesh.