A judge in London has ordered a trade finance asset manager to hand over documents to a private Italian bank which has developed doubts over the contents of securitised trade receivables it holds €344mn in notes for, some of which have rapidly lost value.
Banca Generali argued in a High Court suit filed earlier this year that CFE Finance, a Swiss-headquartered firm specialising in trade finance assets, had provided “inaccurate information” and was refusing to produce documents relating to receivables contained in four trade finance securitisation structures.
In two of the structures, the bank was a senior notes initial subscriber, and in the other two was a placing agent for notes purchased by its clients. The receivables all concern exports from Europe to emerging markets.
In a June 15 judgement, Justice Sarah Falk granted the bank access to the documents – including guarantees, indemnities, security documents and letters of credit – with some limitations on their use in order to satisfy CFE’s confidentiality concerns.
Banca Generali said in its March filing that it required the documents to understand the true nature of the receivables and make accurate reports to its regulators and clients, after losing faith in the accuracy of CFE’s quarterly reports.
The lender says CFE’s description of the receivables contained in three of the securitisation structures began to change in November last year.
For example, the bank says in its evidence that until August 2021, CFE reported that one of the structures comprised 10 sovereign letters of guarantee, 11 letters of credit and one “commercial facility”, all of which were between 85% to 100% backed by an export credit agency (ECA) guarantee “from an identified agency”.
However in CFE’s November report, the contents of the same structure were listed as 13 loans/leases, five letters of credit, two sovereign debts and one promissory note. Instead of total ECA cover, only five of the 21 receivables were backed by a guarantee, “with no indication of the identity of the guarantor or of the nature and amount of the guarantee”.
Then in the February 2022 report, the description changed again, with the sovereign debts described as “under restructuring” and three term loans added, among other changes. The five guarantee-backed exposures described in the November report had been altered to explain that the ECA guarantees had “already been enforced” on two of the exposures and the remaining three had only “some political and/or economic risk cover”.
According to the judgement, the largest receivable in one of the structures had been described by CFE in its August report as being a sovereign letter of guarantee from Sudan, with a principal amount of €10mn, 95% of which was covered by an unidentified ECA.
But by February, the judgement notes, the debt was described as distressed and with a principal of only €3.3m, “said to have followed a write-off of debt owed by Sudan”.
An even bigger surprise to the bank was CFE’s letter in March this year which, according to the judgement, disclosed “that an ECA guarantee had been enforced before [CFE] acquired the receivable, such that there had been no security at any relevant time”.
“It was also subsequently clarified that the debt was written off in July 2021, that is before the report as at August 31 and well before the report as at November 30, which had described the debt as sovereign debt with a guarantee, without reference to a write off,” the judgement recounts.
The bank also said Cuban receivables with a nominal value of over €40mn, acquired between October 2021 and January this year, were sold in April for about 20% of their nominal value, which CFE described as “the best offer at the time”. Other Cuban receivables had also been sold for less than a quarter of their nominal value.
CFE said the receivables collapsed in value partly due to Cuba’s support for Russia’s invasion of Ukraine, although the bank countered that Cuba has long been heavily sanctioned by the US and that the receivables were purchased despite a previous “default in respect of other receivables with the same originator”.
Investments were ‘high-risk, high-reward’
The judgement says Banca Generali sharpened its scrutiny of the receivables following a separate case last year in which the bank was forced to make an €80mn loss provision on notes it purchased from CFE for securitised healthcare receivables, after “repeated issues” with their value.
The judgement shows the healthcare receivables are subject to an “ongoing criminal investigation” in Italy, alongside probes by the Bank of Italy and Consob, the country’s financial services regulator.
The investigations are not related to CFE’s conduct. The company’s position, described by Justice Falk, is “that they are just as much the victim of what they say is the limited wrongful activity that has been uncovered in relation to those transactions as [Banca Generali]”.
The notes from the first securitisation structure, TF I, were not fully redeemed in October last year as scheduled and the bank claims that a report prepared by law firm Dentons found “that inaccurate information had been provided to the bank in respect of the underlying exposures in that securitisation”. Those outstanding notes are worth €42mn, according to Bloomberg.
The legal proceedings relate to outstanding notes, worth €297mn, for the three remaining structures.
The maturity date of the second structure, TF II, fell in April but the notes were not redeemed. The judgement says the bank, as a senior noteholder, has demanded immediate payment and the parties are waiting on a third party to independently value the receivables.
CFE says the changes made to its quarterly reports were “to report in accordance with the forms mandated by the European Securities and Markets Association” (ESMA), according to the judgement. It says that the EU regulator’s ongoing development of technical standards and templates for securitisation reporting was disclosed as a risk factor in its prospectus.
The asset manager says “teething problems” transitioning to ESMA’s format have been mended and that “the problems were historic and that there is no requirement to provide underlying documents”.
In addition to fears that disclosing the documents could breach confidentiality clauses it has signed, CFE also argued that Banca Generali’s requests would be an unreasonable burden on the firm because the relevant team is made up of only four individuals, and the bank’s previous information requests have already caused delays to its regular reporting schedule.
According to the judgement, CFE is prepared to continue to co-operate with the bank, but its case is that “the bank placed high-risk notes with its clients, some of which have not performed as might have been hoped due to circumstances that include Covid-19 and the war in Ukraine”.
“The senior notes were high risk, high reward investments that were unlisted and unhedged, underpinned by receivables from high-risk counterparties in developing countries,” Justice Falk summarised CFE as saying. “The significant degree of risk that existed, including the risk that amounts invested would not be recovered, was clearly disclosed in the prospectuses.”
The company argues that Banca Generali, faced with losses, is now “attempting to blame [CFE] by making unwarranted insinuations as to their integrity, and making overblown and self-serving assertions”.
CFE’s website says that since it was founded in 2001, the firm has arranged more than €3.5bn in trade finance transactions and over 25 “bespoke securitisation vehicles”, collectively worth more than €1.5bn, for clients such as asset managers, family offices and banks.
The company did not respond to a request for comment from GTR.
Banca Generali’s general counsel Carmelo Reale welcomed the court ruling, saying that it confirmed standards “which arrangers must comply [with] in order to give greater transparency to customers with regard to products by their illiquid nature”.
On a May earnings call, the bank’s chief executive Gian Maria Mossa said that Banca Generali has no current need to buy back the notes placed with clients. Trade finance is an asset class “that can be subject to market volatility” and CFE has confirmed that the problems are restricted to Sudanese and Cuban receivables, he added.
A spokesperson for the bank tells GTR that the notes formed part of diversified portfolios held by professional investors, which have continued paying dividends.
Tags: , , , , , , , , , , , ,
Geneva, Switzerland
Abidjan, Côte d’Ivoire
Become a part of the most comprehensive contact listing of service providers in the global trade, commodity and export finance markets.
This Privacy Policy outlines the information we may collect about you in relation to your use of our websites, events, related publications and services (“personal data”) and how we may use that personal data. It also outlines the methods by which we and our service providers may (subject to necessary consents) monitor your online behaviour to deliver customised advertisements, marketing materials and other tailored services. This Privacy Policy also tells you how you can verify the accuracy of your personal data and how you can request that we delete or update it.
This Privacy Policy applies to all websites operated by Exporta Publishing & Events Ltd (as indicated on the relevant website).
This privacy statement does not cover the activities of third parties, and you should consult those third-party sites’ privacy policies for information on how your data is used by them.
Any questions regarding this Policy and our privacy practices should be sent by e-mail to privacy@gtreview.com or by writing to Data Protection Officer at, Exporta Publishing & Events Ltd, 4 Hillgate Place, London, SW12 9ER, United Kingdom. Alternatively, you can telephone our London headquarters at +44 (0) 20 8673 9666.
Established in 2002 and with offices in London and Singapore, Exporta Publishing & Events Ltd is the world’s leading trade and trade finance media company, offering information, news, events and services for companies and individuals involved in global trade.
Our principal business activities are:
Exporta Publishing & Events Ltd is a company registered in the United Kingdom with company number 4407327 | VAT Registration: 799 1585 59
This Data Protection Policy explains when and why we collect personal information about people who visit our website, how we use it, the conditions under which we may disclose it to others and how we keep it secure.
Why do we collect information from you?
Our primary goal in collecting personal data from you is to give you an enjoyable customised experience whilst allowing us to provide services and features that will meet your needs.
We collect certain personal data from you, which you give to us when using our Site and/or registering or subscribing for our products and services. However, we also give you the option to access our Sites’ home pages without subscribing or registering or disclosing your personal data.
We also collect certain personal data from other group companies to whom you have given information through their websites (including, by way of example, Exporta Publishing & Events Ltd and subsidiaries, in accordance with the purposes listed below). Should we discover that any such personal data has been delivered to any of the Sites, we will remove that information as soon as possible.
This Data Protection Policy ensures Exporta Publishing & Events Ltd:
We may change this Policy from time to time so please check this page occasionally to ensure that you’re happy with any changes. By using our website, you’re agreeing to be bound by this Policy.
The Data Protection Act 1998 described how organisations – including Exporta Publishing & Events Ltd – must collect, handle and store personal information. These rules apply regardless of whether data is stored electronically, on paper or on other materials. To comply with the law, personal information collected must be stored safely, not disclosed unlawfully and used fairly.
The Data Protection Act is underpinned by eight important principles. These say that personal data must:
We obtain information about you when you use our website, for example, when you contact us about products and services, when you register for an event, register to receive eNewsletters, subscribe or register for a trial to our GTR magazine/website.
On some Sites, Exporta Publishing & Events Ltd collects personal data such as your name, job title, department, company, e-mail, phone, work and/or home address, in order to register you for access to certain content, subscriptions and events. In addition, we may also store information including IP address and page analytics, including information regarding what pages are accessed, by whom and when.
This information is used to administer and deliver to you the products and/or services you have requested, to operate our Sites efficiently and improve our service to you, and to retain records of our business transactions and communications. By using the Sites and submitting personal information through the registration process you are agreeing that we may collect, hold, process and use your information (including personal information) for the purpose of providing you with the Site services and developing our business, which shall include (without limitation) the purposes described in the below paragraphs.
Where, as part of our Site services, we enable you to post information or materials on our Site, we may access and monitor any information which you upload or input, including in any password-protected sections. Subject to any necessary consents, we also monitor and/or record the different Sites you visit and actions taken on those Sites, e.g. content viewed or searched for. If you are a registered user (e.g. a subscriber or taking a trial), when you log on, this places a cookie on your machine. This enables your access to content and services that
are not publicly available. Once you are logged on, the actions you take – for example, viewing an article – will be recorded (subject to any necessary consents). We may use technology or a service provider to do this for us. This information may be used for one or more of the following purposes:
Please see paragraph 5 below for more information on cookies and similar technologies and a link to a page where you can turn them on or off.
Some of your personal data collected under paragraphs 1 and 2 above may be used by us to contact you by e-mail, telephone and/or post for sending information or promotional material on our products and/or services and/or those of our other group companies. We give you the opportunity to opt-out of receiving marketing communications. Further detail can be found on the applicable Site and in the footer of each marketing communication sent by us, our group companies or service providers. See also “Consents and opt-outs” section below. We will not share your information with third parties for marketing purposes.
We may analyse your personal information to create a profile of your interests and preferences so that we can contact you with information relevant to you.
All our Sites use cookies and similar technical tools to collect information about your access to the Site and the services we provide.
When you enter some sites, your computer will be issued with a cookie. Cookies are text files that identify your computer to servers. Cookies in themselves do not identify the individual user, just the computer used.
Many sites do this whenever a user visits their site in order to track traffic flows, recording those areas of the site that have been visited by the computer in question, and for how long.
Users have the opportunity to set their computers to accept all cookies, to notify them when a cookie is issued, or not to receive cookies at any time. Selecting not to receive means that certain personalised services Exporta Publishing & Events Ltd offers cannot then be provided to that user.
All of the major browser providers offer advice on setting up and using the privacy and security functions for their products. If you require technical advice or support for a specific browser/version please contact the provider or visit their website for further details: www.microsoft.com / www.mozilla.com / www.apple.com / www.opera.com / www.aol.com / www.netscape.com / www.flock.com / www.google.com.
Most web browsers automatically accept cookies but, if you prefer, you can change your browser to prevent that, or to notify you each time a cookie is set. You can also learn more about cookies in general by visiting www.allaboutcookies.org which includes additional useful information on cookies and how to block cookies using different types of browser. Please note however, that by blocking, deleting or turning off cookies used on the Site you may not be able to take full advantage of the Site.
E-mail tracking is a method for monitoring the e-mail delivery to those subscribers who have opted-in to receive marketing e-mails from GTR, including GTR Africa, GTR Asia, GTR Americas, GTR Europe, GTR Mena, GTR eNews, Third party e-mails and GTR Ventures.
So that we can better understand our users’ needs, we track responses, subscription behaviour and engagement to our e-mails – for example, to see which links are the most popular in newsletters. They enable us to understand the consumers journey through metrics including open rate, click-through rate, bounces and unsubscribes. Any other purposes for which Exporta Publishing & Events Ltd wishes to use your personal data will be notified to you and your personal data will not be used for any such purpose without obtaining your prior consent.
To do this, we use pixel GIFs, also known as “pixel tags” – these are small image files that are placed within the body of our e-mail messages. When that image is downloaded from our web servers, the e-mail is recorded as being opened. By using some form of digitally time-stamped record to reveal the exact time and date that an e-mail was received or opened, as well the IP address of the recipient.
You can give your consent to opt-out of all or any particular uses of your data as indicated above by:
To turn cookies and similar technologies on and off, see the information in paragraph 5 above. Any questions regarding consents and opt-outs should be sent by e-mail to privacy@gtreview.com or by writing to Data Protection Officer at, Exporta Publishing & Events Ltd, 4 Hillgate Place, London, SW12 9ER, United Kingdom. Alternatively, you can telephone our London headquarters at +44 (0) 20 8673 9666.
Information collected at one Site may be shared between Exporta Publishing & Events Ltd and other group companies for the purposes listed above.
We may transfer, sell or assign any of the information described in this policy to third parties as a result of a sale, merger, consolidation, change of control, transfer of assets or reorganisation of our business.
Some of our Sites may have a message board, blogs or other facilities for user generated content available and users can participate in these facilities. Any information that is disclosed in these areas becomes public information and you should always be careful when deciding to disclose your personal information.
Services on the Internet are accessible globally so collection and transmission of personal data is not always limited to one country. Exporta Publishing & Events Ltd may transfer your personal data, for the above-listed purposes to other third parties, which may be located outside the European Economic Area and/or with a different level of personal data protection. However, when conducting transfers, we take all necessary steps to ensure that your data is treated reasonably, securely and in accordance with this Privacy Statement.
We are committed to keeping the data you provide us secure and will take reasonable precautions to protect your personal data from loss, misuse or alteration.
However, the transmission of information via the internet is not completely secure. Although we will do our best to protect your personal data, we cannot guarantee the security of your data transmitted to our Site; any transmission is at your own risk. Once we have received your information, we will use strict procedures and security features described above to try to prevent unauthorised access.
We have implemented information security policies, rules and technical measures to protect the personal data that we have under our control from:
All our employees, contractors and data processors (i.e. those who process your personal data on our behalf, for the purposes listed above), who have access to, and are associated with the processing of your personal data, are obliged to keep the information confidential and not use it for any other purpose than to carry out the services they are performing for us.
Everyone who works for or with Exporta Publishing & Events Ltd has some responsibility for ensuring data is collected, stored and handled appropriately. Each team handling personal data must ensure that it is handled and processed in line with this policy and data protection principles. However, the following people have key areas of responsibility. The board of directors is ultimately responsible for ensuring that Exporta Publishing & Events Ltd meets its legal obligations.
Name of Data Controller
The Data Controller is Exporta Publishing & Events Ltd. Exporta Publishing & Events Ltd is subject to the UK Data Protection Act 1998 and is registered in the UK with the Information Commissioner`s Office.
If you wish to know whether we are keeping personal data about you, or if you have an enquiry about our privacy policy or your personal data held by us, in relation to any of the Sites, you can contact the Data Protection Officer via:
Upon request, we will provide you with a readable copy of the personal data which we keep about you. We may require proof of your identity and may charge a small fee (not exceeding the statutory maximum fee that can be charged) to cover administration and postage.
Exporta Publishing & Events Ltd allows you to challenge the data that we hold about you and, where appropriate in accordance with applicable laws, you may have your personal information:
In certain circumstances, the Data Protection Act allows personal data to be disclosed to law enforcement agencies without the consent of the data subject. Under these circumstances, Exporta Publishing & Events Ltd, will disclose requested data. However, the Data Controller will ensure the request is legitimate, seeking assistance from the board and from the company’s legal advisors where necessary.
We will occasionally update this Privacy Statement to reflect new legislation or industry practice, group company changes and customer feedback. We encourage you to review this Privacy Statement periodically to be informed of how we are protecting your personal data.
Exporta Publishing & Events Ltd aims to ensure that individuals are aware that their data is being processed, and that they understand.
To this end, the company has a privacy statement, setting out how data relating to individuals is used by the company. This is available on request and available on the company’s website.
We keep this Policy under regular review. This Privacy Statement was last updated in April 2018.


Lascia un commento

Il tuo indirizzo email non sarà pubblicato. I campi obbligatori sono contrassegnati *