Founded in 1978, the Association of Forfaiters in Switzerland (VEFI) is the oldest forfaiting association in the world.
VEFI is the association for financial institutions and specialised companies who are active in the trade finance and forfaiting business in Switzerland. Currently, VEFI represents 17 members.
Our goals are
- to improve the general recognition of the Swiss forfaiting and trade finance market
- to share knowledge and experience among our members
- to introduce exporters, importers and financial institutions to the benefits of forfaiting and trade finance
- to provide networking opportunities for our members
VEFI also acts as the Swiss regional committee of the International Trade and Forfaiting Association (ITFA). With members all over the world, ITFA brings together banks and financial institutions who are engaged in originating, structuring and distributing trade related risk. Expanding from its original focus on the purchase and discounting of simple but robust payment instruments, such as negotiable instruments and letters of credit, the forfaiting industry has embraced new instruments and created new structures to become a prominent part of supply chain finance.
VEFI Bowling and Jass Championship
Date and time: 19 March 2024, 17:30 pmLocation: Restaurant Schützenruh, Zurich
News
Save the dates: VEFI Events scheduled for 2024 - updated on 23rd January 2024
We have now reserved the venue as follows:The Bowling and Jass Championship will take place on 19th March, 2024 at Restaurant Schützenruh. The AGM will be held on 16th May 2024 (from 17.30 p.m.), the Summer Cocktail on 28th August 2024 and the Christmas Cocktail on 12 December 2024. The date for the autumn event has yet to be confirmed. We recommend to all members to save the dates. The invitations will be prepared some time before the events take place.
VEFI- and ITFA Christmas Cocktail 2023
On December 14th 2023 the Association of Forfaiters in Switzerland (Vefi) hosted its annual Christmas gathering at one of the traditional guild houses in Zurich. The members and also the forfaiting legends present enjoyed a fantastic evening with nice food and wine in very pleasant company. There was lots to catch up conversations at the end of yet another eventful year.We thank ITFA for their continuing support to make this great event possible.
With best wishes for a happy new year from the VEFI-Board!
ITFA and VEFI Education Event was held on 27th October 2023
The topic of the event was “How Tokenization will unlock Trillions of dollars in value in the coming 5 years.”, an introduction into a topic that was not yet very familiar for most attending members. Speakers were both Pan Theo Grosse-Ruyken and Keith J. Schöner, both representing PTGR AG, Zug, who gave some interesting insights into the new technology and it's opportunities. Afterwards, members had the possibility to meet at our traditional venue "Haus zum Rüden". Lively discussions occured about various topics of interest. We thank ITFA for sponsoring this event.The VEFI Summer Cocktail was celebrated on 31st August 2023
We held our traditional VEFI Summer Cocktail at the head-office of ZKB in Zurich. We were blessed by a pleasant late summer evening, and many members joined us for another successful event at this very exclusive location.We thank ZKB for hosting this great opportunity for networking.
VEFI welcomes ING Bank N.V., Amsterdam, Zürich Agency as new member
The VEFI board is pleased to announce that ING Bank N.V., Amsterdam, Lancy / Geneva branch, Zürich Agency has joined the association. ING Bank N.V., Zürich Agency offers an ample choice of Trade Finance products, including Forfaiting.VEFI Annual General Meeting on 10th May 2023
This year we have moved to another location for our AGM. It was held at the very scenic Zunfhaus zur Saffran, another one of the traditional guild houses in Zurich.The VEFI-board has been re-elected for the next term, with one major change:
Joëlle Schmidt has been elected as Chairwoman of the association, while Dieter von Boddien after 12 years has stepped down from this position. He will continue serving as board member. Xiaofeng Wang, Thomas Stoiber and Prasanna Francis have been all been re-elected.
Martin Diggelmann and Nathalia Benjamin have been re-elected as VEFI auditors.
The board would like to also express it's gratitude to ITFA, the International Trade and Forfaiting Association, who has sponsored 2 events during the last year. Also we would like to thank all members that directly or indirectly have given support to the Association of Forfaiters in Switzerland during the past year.
After the AGM, we had the opportunity to learn more about Zurich Airport. The presentation was held by Stefan Weber, CFO a.i. of the Airport. We thank him for the interesing insights he has offered us.
VEFI Bowling Championship 2023
The Bowling and Jass Championship has taken place on 23rd March 2023. With a record attendance it has been a great opportunity for networking. Thanks again to Willis Towers Watson for their generous support.
VEFI welcomes ICBC, Zurich Branch as new member
The VEFI board is pleased to announce that Industrial and Commercial Bank of China Ltd., Zurich Branch has joined the association by the end of 2021. ICBC Zurich Branch offers an ample choice of Trade Finance products, including Forfaiting.Board
Events
2024
12th December 2024 at 5:30 pm
VEFI/ITFA Christmas Cocktail
Haus zum Rüden
28th August 2024 at 5:30 pm
VEFI-Summer Cocktail 2024
Swiss Re
16 May 2024 at 5:30 pm
45th Annual General Meeting (AGM)
Haus zum Rüden
19th March 2024 at 5:30 pm
Annual Bowling- and Jass-Championship
Restaurant Schützenruh, Zürich
2023
14th December 2023 at 5:30 pm
VEFI/ITFA Christmas Cocktail
Haus zum Rüden
27 October 2023 at 11:30 am
VEFI/ITFA Education Event
Haus zum Rüden
31st August 2023 at 5:30 pm
VEFI-Summer Cocktail 2023
ZKB, Zurich
10 May 2023 at 11:00 am
44th Annual General Meeting (AGM)
Zunfhaus zur Saffran, Zürich
23rd March 2023 at 5:30 pm
Annual Bowling- and Jass-Championship
Restaurant Schützenruh, Zürich
2022
20th December 2022 at 5:30 pm
VEFI/ITFA Christmas Cocktail
Haus zum Rüden
27th October 2022 at 12:00 noon
VEFI Networking Lunch
Haus zum Rüden
25th August 2022 at 5:30 pm
VEFI-Summer Cocktail 2022
Almodobar, Zurich
12th May 2022 at 17:15 pm
43rd Annual General Meeting (AGM)
Impact Hub Bogen D
22nd March 2022 at 5:30 pm
Annual Bowling- and Jass-Championship
Restaurant Schützenruh, Zürich
2021
2nd December 2021 at 5:30 pm
VEFI and ITFA Christmas Cocktail
Haus zum Rüden
28th October 2021 at 11:30 am
VEFI Education Event
Haus zum Rüden
23rd August 2021 at 5:30 pm
VEFI-Summer Cocktail 2021
Swiss Re
20th May 2021 at 11:30 am
42nd Annual General Meeting (AGM)
Via Zoom
2020
7th May 2020 at 10:30 am
41st Annual General Meeting (AGM)
Atlantic Forfaitierungs AG, Zürich
About Forfaiting
Description of a Forfaiting Transaction
Forfaiting is the term generally used to denote the purchase of obligations falling due at some future date, arising from goods and services – mostly export transactions – without recourse to any previous holder of the obligation.In a simple transaction, an importer and an exporter close a commercial transaction that is embodied in a contract to exchange goods, machinery, key-turn plants, etc…for payment sometime in the near future. While closing the contract, the exporter might decide he is reticent to accept either the creditworthiness of the importer or the terms and conditions of the payments of the goods to be delivered. To reduce the credit risk, the exporter would require that the importer’s bank irrevocably and unconditionally guarantees payment upon evidence that the goods have been shipped. To totally offset his risk exposure and to bridge the deferred payment, which typically ranges from 1 month to 5-7 years after the goods are shipped, the exporter will sell the receivables (the deferred guaranteed obligation of payment) at a discount from face value (or net present value). This discounting enables the exporter to receive payment with a few days after the shipment of goods, instead of waiting for the completion of the payment period and thereby mitigates any open credit risk and transfer risk.
These receivables take the form of bills of exchange, promissory notes, letters of credit, letters of guarantee, book receivables, etc… although any form of debt could, in theory, be forfaited. The underlying debt instrument must be irrevocable, unconditional, transferable and must allow the beneficial owner to collect his money without delay or prejudice on the agreed upon collection date. Further, there must be no legal connection between the warranty on the goods and the execution of the financial arrangement.
This particular kind of financial service is particularly well appreciated in the Transitional Economies or in Emerging Markets, where it does not exist an appropriate financial network able to provide either a strong currency financing or a medium-long term financing at the competitive lending interest rates.
Transaction Diagram
The following diagram depicts a simple transaction showing parties and flow of goods, information and funds.
1) Calculate the total number of days between disbursement and maturity; adjust for non-working days and add the grace days.
2) Calculate the number of whole year periods (for annual yield) or 183-/182-day-periods (for semi-annual yield)
3) Calculate a factor as described below (basis 365/360).
4) The face value is divided by this factor to give the net value (multiplied in the case of Straight Discount).
Discount-to-yield annually compounded:
AnnualYieldFactor=(1+Y/100 x 365/360)N x (1+ Y/100 x D/360)
Y = Annual Yield Rate, N = Number of whole years (365 days), D = Number of odd days
Discount-to-yield semi-annually compounded:
SemiAnnualYieldFactor=(1+Y/100 x 183/360) N1 x (1+Y/100 x 182/360) N2 x (1+Y/100 x D/360)
Y = Semi-annual Yield Rate, N1 = Number of 183 day periods, N2 = Number of 182 day periods, D = Number of odd days
Straight discount:
StragihtDiscountFactor=(1-%/100 x D/360)
% = Straight Discount Rate, D = Number of days
The difference between a discount-to-yield and a straight discount
is that a discount-to-yield is calculated on the basis of the Net (Present) Value to achieve the Face Value (or Nominal Value); thus Net Value + Interest = Face Valuea straight discount is calculated on the basis of the Face Value to achieve the Net Value; thus Face Value - Interest = Net Value
This implies that calculating a straight discount is considerably easier (in fact a simple interest calculation) than calculating a discount-to-yield. Discount-to-yield calculations become quite complicated once compounding (interest on interest) is applied.
Let us assume the following example:
The forfaiter is about to purchase a Bill of Exchange with a tenor of exactly one year and an amount of USD 1'000'000.00. Let us further assume that the 12months-USD-Libor would be 5.75% and the margin would be 2.25%, the all-in rate would hence be 8%.
Discount-to-yield: Interest is calculated on Net Value
Interest = USD 924'974.31 * 8% * 365days / 36000 = USD 75'025.69
Face Value = USD 924'974.31 + USD 75'025.69 = USD 1'000'000.00
(Note that we are using a 365/360 days basis)
Obviously, for calculating on a discount-to-yield basis, the problem is to determine the net value. The formulae to calcualte it is described on the previous page.
Also it is clear that if we apply the same Net Value for the above transactions than the straight discount rate must be smaller than the discount-to-yield rate (remember that we are calculating interest on the face value). In fact, the forfaiter will usually quote on a discount-to-yield rate (libor + margin) and convert this rate into a straight discount yield if the customer requires so.
Straight discount: Interest is calculated on Face Value
From the above we know that the interest (yield) for 365days at 8% is USD 75'025.69. So what interest rate do we get if we calculate this interest on an amount of USD 1'000'000.00 (the Face Value)? Interest Rate = USD 75'025.69 * 36000 / (USD 1'000'000.00 * 365days) = 7.3998%
Want to download our free discounting spreadsheet?
Requires Microsoft Excel 97 E or above; 62k file size.Note: This utility is provided to you as is. We do not warrant uninterrupted or error free operation.
Under no circumstances are we liable for any of the following:
1. third-party claims against you for losses or damages;
2. loss of, or damage to, your records or data; or
3. economic consequential damages (including lost profits or savings) or incidental damages, even if we are informed of their possibility.
Download spreadsheet
You may use, change or distribute this worksheet as long as you mention the source "VEFI -The Association of Forfaiters in Switzerland". Terms for changing the spreadsheet see below.
The first section will help you to determine the face values based on a given contract amount
- face values are calculated by applying simple interest on the reducing balance
The second section will help you to discount notes with known face values and maturities:
- interest is calculated on a straight discount or discount-to-yield basis
- annual or semi-annual compounding is applied to yields
- 365/360 or 365/365 days basis are used
- grace days and weekends (but not bank holidays) are taken into account
- interpolated interest rates (eg. calculate the rate for a 540 days note from a given 12 months and the 2 years rate) are calculated
- matching libor ("rough") or average life libor are used
To the best of our knowledge this spreadsheet is Year2000 compliant and virus free (no macros contained).
Copyright by VEFI - The Association of Forfaiters in Switzerland
http://www.forfaitswiss.ch
Terms for changing this worksheet: To change the worksheet you have to unprotect it. You do not need a password to unprotect. We will not be able to assist you. Whatever you do (or what we did) you will have to find out yourself. If you like the spreadsheet send a friendly e-mail to our webmaster.
Members
Atlantic Forfaitierungs AG
Tel +41 44 254 53 00
Othmarstrasse 8
Fax +41 44 254 53 01
CH-8008 Zürich
SWIFT: AFCLCHZZ
Martin Fankhauser, CEO
Credit Suisse (Schweiz) AG
Tel +41 44 333 63 97
Trade Syndication
Uetlibergstrasse 231
Stefan Vögeli
CH-8070 Zürich
Finanz AG Zürich
Phone +41 44 214 63 14
Bahnhofstrasse 52
CH-8001 Zürich
Hanspeter Rellstab
Habib Bank AG Zürich
Tel +41 44 269 45 00
Weinbergstrasse 59
Fax +41 44 211 36 27
CH-8006 Zurich
HSBC Bank plc, London
Tel +41 44 289 23 50
Zurich Branch
Fax +41 44 289 23 55
Trade & Supply Chain
eMail: zurich.trade@hsbc.com
Bederstrasse 49
Postfach 1818
CH-8027 Zürich
Shana Ristic, Shivali Sitters
Tel. +41 79 250 5538
Industrial and Commercial Bank of China Ltd., Zurich Branch
Tel +41 58 909 55 88
Nuschelerstrasse 1
Fax +41 58 909 55 77
CH-8034 Zurich
Swift : ICBKCHZZXXX
ING Bank N.V., Amsterdam
Tel +41 22 592 29 96
Lancy / Geneva branch, Zürich Agency
Fax +41 22 592 30 09
Transaction Services Sales
SWIFT: BBRUCHGT
Gartenstrasse 25
CH-8002 Zurich
LUGANO TRADE FINANCE SA
Tel +41 (0)91 - 9116440
Via degli Albirizzi, 1
Fax +41 (0)91 - 9116449
CH-6900 Lugano
SFC Swiss Forfaiting Company Ltd.
Tel +41 44 202 94 40
Stockerstrasse 58
Fax +41 44 202 94 42
P.O. Box
Salvatore Chiappinelli, CEO
CH-8039 Zurich
SOCIETE GENERALE
Tel +41 58 27 23 429
Global Transaction Banking
Fax +41 58 272 34 39
Talacker 50
P.O. Box 5070
CH-8021 Zurich
Swiss Re International SE
Tel +41 43 285 7432
Zurich Branch
Fax +41 43 282 7432
Mythenquai 50/60
Volker Handrich, Head Trade & Supply Chain Finance
P.O. Box
CH-8022 Zurich
TCT Trans Continental Trade AG
Tel 078 655 04 09
Bahnhofstrasse 4
CH-6340 Baar
Möhrlistr. 97
8006 Zürich
TFA Trade Finance Advisors SA
Tel. +41 91 921 3978
Via G. Calgari, 2
Mob. +41 79 959 5644
CH-6900 Lugano
Mob. +39 349 5281962
UBS Switzerland AG
Tel +41 44 236 72 62
Bahnhofstrasse 45
Fax +41 44 239 92 34
CH-8021 Zurich
ZP Software AG
Tel +41 (0)56 610 11 80
Baumgartenstrasse 4
Mob +41 (0)76 324 39 82
P.O. Box 826
CH-5200 Brugg
Zürcher Kantonalbank
Tel +41 44 292 87 13
International Business
Fax +41 44 292 87 94
P.O. Box
CH-8010 Zurich
Joëlle Schmidt, Head Trade Finance Syndication & Supranationals
Statutes
German version dated 23rd May 2013
English Translation of the version of 23rd May 2013
Contact
c/o Atlantic Forfaitierungs AG
Othmarstrasse 8
8008 Zurich
Switzerland
Phone: +41 44 254 53 00
Fax: +41 44 254 53 01
E-mail: info@vefi.ch