BWBB3033 INTERNATIONAL BANKING QUESTION FOUR (20 MARKS) A l

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BWBB3033 INTERNATIONAL BANKING QUESTION FOUR (20 MARKS) A letter of… BWBB3033 INTERNATIONAL BANKING QUESTION FOUR (20 MARKS) A letter of credit is a bank’s conditional promise to pay issued by a bank at the request of an importer, in which the bank promises to pay an exporter upon presentation of documents specified in the letter of credit. A letter of credit reduces the risk of non-completion because the bank agrees to pay against documents rather than actual merchandise. a) Construct and discuss the flow for letter of credit using appropriate diagram. (8 marks) b) Elaborate critically each party that involved in letter of credit movement. (12 marks)Accounting Business Financial Accounting BWBB 3033

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