chapter 13-international payments and settlements.ppt

Chapter 13 International Payments and Settlements 1.Definition of International Payments and Settlements International payments and settlements are financial activities conducted among different countries in which payments are effected or funds are transferred from one country to another in order to settle accounts, debts, claims, etc.,emerged in the course of political ,economic or cultural contacts among them. 2.Credit instruments 2.1 What is meant by credit instruments? A credit instrument is a written or printed paper by means of which funds are transferred from one person to another. Credit instruments most commonly used in international payments and settlements are bill of exchange(汇票), promissory notes（本票） and cheques（支票）. These three are also known as negotiable instruments. Credit instruments may also take such forms as traveler’s cheques(旅行支票), certificates of deposit（可转让定期存单）, treasury bills（国库券）, treasury bonds(国库债券), etc. Traveler’s Check旅行支票 ----A specially printed form of check issued by a financial institution, leading hotels, and other agencies in preprinted denominations for a fixed amount to a customer for use when he is going to travel abroad. certificates of deposit（可转让定期存单） -----A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed?interest rate and can be issued in any denomination.?CDs are generally issued by commercial banks and are insured?by the FDIC. The term of?a CD generally?ranges from one month to five years. Treasury Bills?(T-bills) are short-term debt instruments issued by the government to raise money from the public. They are part of the series of marketable securities issued by the government including bills (1 yr), notes (1yr-10 yr), and bonds ( 10yr). 2.2 Functions of a negotiable instrument As a means of payments----Under non-cash settlements, negotiable instruments to be commonly used as a payment instrument are bills of exchange, promissory notes and cheques, among wh