T/T (Swift) Payment Via Intermediate Bank

[pault17]

I'm ordering from China and they want a T/T (Telegraphic Transfer) payment commonly known as "using SWIFT code to make international Funds Transfer".

So far so good.

The trouble is they want a US$ transferred to them via an American bank.

This way of working is documented on the Internet and seems to be used mainly with Chinese suppliers.

Here are their "payment instructions".

1. BENEFICIARY:Name company

2. ADDRESS: address company

3. BENEFICICARY BANK: Name bank

4. BENEFICICARY ADDRESS:: address bank.

5. ACCOUNT: account number

6. SWIFT NO:#########

7. TRANSFER BANK:BANK xxx NEW YORK BRANCH (SWIFT NO:#########)

8. ABA NO:###

The local Kasikorn branch tells me they can not execute such a payment.

The Kasikorn Contact Center, apart from being snotty, talk around the subject and do not provide an answer.

My Chinese contact tells me they have a Thai customer who has no problems making this type of payment but they did not tell me which bank. I did not insist too much as I got the impression there was a confidentiality issue.

So, before breaking any pots in China: Can anybody here help me?

Thamks in advance.

[sulasno]

all transfers using USD have to be routed via USA

have you tried doing a TT from another bank ?

[pault17]

Thanks. I did not know.

And I did not try another bank.

I'm not surprised Kasikorn doesn't know, but my bank in Europe?

Anyway, I have new hope for a solution.

[ianguygil]

Thanks. I did not know.

And I did not try another bank.

I'm not surprised Kasikorn doesn't know, but my bank in Europe?

Anyway, I have new hope for a solution.

If you want to move these funds from Thailand you can easily do so via Bangkok Bank. Please PM me if you need help with this, we are the largest correspondent in Thailand and we are the only Thai bank to have a branch in New York. Others have Rep Offices which are not the same as Branches.

BTW, techically all USD transfers do not have to go via the US. I think there is some misunderstanding here. While it may affect correspondent accounts in the US via NOSTRO/VOSTRO accounts, the accounts involved in the transfer can all be offshore.

Anyway, please let me know if I can help you.

Ian

[pault17]

Thank you Ian,

With the info sulasno gave me I started googgleing again and found out that there is a branch of the Bank of China - the bank I should ttransfer the money to) in BKK. Tried to call them on the phone but the line is 'always' busy.

If I can't reach them I will go to the local Bangkok Bank, and if I need more help I'll PM you.

[Naam]

techically all USD transfers do not have to go via the US. I think there is some misunderstanding here. While it may affect correspondent accounts in the US via NOSTRO/VOSTRO accounts, the accounts involved in the transfer can all be offshore.

i [not so] humbly beg to differ Ian. please update your information.

for what it's worth... a transfer of USD between two banks in Singapore goes with IBAN details via NY even if these two banks are located in the same building. something similar applies to €UR transfers which are routed via Frankfurt, Germany. i have transferred EUR from Singapore to Thailand. Bangkok Bank is the intermediate bank in Thailand for my SG bank when i make EUR transfers. BUT, according to my bank, the "booking" is done in Frankfurt.

this fact does not concern me but it concerns those Germans who bank in SG, live partially in Thailand or anywhere abroad but are still slaves of the German taxman. any multinational bank of good standing will advise their clients about the potential problems if their names are popping up in the U.S. or in Germany and recommend to convert EUR or USD and transfer CHF via Zürich. how long the latter will be "safe" is a different animal.

[ianguygil]

techically all USD transfers do not have to go via the US. I think there is some misunderstanding here. While it may affect correspondent accounts in the US via NOSTRO/VOSTRO accounts, the accounts involved in the transfer can all be offshore.

i [not so] humbly beg to differ Ian. please update your information.

for what it's worth... a transfer of USD between two banks in Singapore goes with IBAN details via NY even if these two banks are located in the same building. something similar applies to €UR transfers which are routed via Frankfurt, Germany. i have transferred EUR from Singapore to Thailand. Bangkok Bank is the intermediate bank in Thailand for my SG bank when i make EUR transfers. BUT, according to my bank, the "booking" is done in Frankfurt.

this fact does not concern me but it concerns those Germans who bank in SG, live partially in Thailand or anywhere abroad but are still slaves of the German taxman. any multinational bank of good standing will advise their clients about the potential problems if their names are popping up in the U.S. or in Germany and recommend to convert EUR or USD and transfer CHF via Zürich. how long the latter will be "safe" is a different animal.

Naam, I don't have a lot of time to reply on this, but the fact is that a payment to an offshore USD account does not have to go through a US bank. The accounting as I said may well affect correspondent accounts in the US (our USD accounts are drawn on our branch in New York) but the payment will not directly involve the US.

When I have time I will elaborate with an example. Right now I am pretty booked and need to run. Thanks

Ian

[Naam]

Naam, I don't have a lot of time to reply on this, but the fact is that a payment to an offshore USD account does not have to go through a US bank. The accounting as I said may well affect correspondent accounts in the US (our USD accounts are drawn on our branch in New York) but the payment will not directly involve the US.

take your time Ian! whatever you dig up is precious information for me because i'm in charge of handling a fistful portfolios and their relevant yield dispersion for some good friends.

nota bene: i am not talking about "correspondent" banks. i am talking about information popping up in New York and/or Frankfurt for whatever reasons unkown to me. this is the gospel from "real" banks. why should they have any interest to spread wrong information?

[ianguygil]

Naam, I don't have a lot of time to reply on this, but the fact is that a payment to an offshore USD account does not have to go through a US bank. The accounting as I said may well affect correspondent accounts in the US (our USD accounts are drawn on our branch in New York) but the payment will not directly involve the US.

take your time Ian! whatever you dig up is precious information for me because i'm in charge of handling a fistful portfolios and their relevant yield dispersion for some good friends.

nota bene: i am not talking about "correspondent" banks. i am talking about information popping up in New York and/or Frankfurt for whatever reasons unkown to me. this is the gospel from "real" banks. why should they have any interest to spread wrong information?

Hi Naam

I will try to get to this tomorrow. I am in annual planning cycle here and you can imagine how much fun that is ..

Obviously as a responsible bank we comply with all the reporting regulations. Maybe if you give me 1 of your use case scenarios I can take you though how it would work and we can see if we are both saying the same thing but using different words. So if you can give me a quick description of the transaction I can try to explain what we and the other banks I have worked for would do. Thank you

Ian

[PattayaParent]

Many moons ago when being paid in US$ and trying to get them transferred from my offhore bank to my onshore location the bank told me the delay was due to the money having to go though Wachovia Bank in New York and explained that ALL US$ moved around the world went that route.

[Naam]

So if you can give me a quick description of the transaction I can try to explain what we and the other banks I have worked for would do.

Ian,

i have transferred today a six digit USD amount from my bank in Singapore to my personal account in Thailand and i will do exactly the same tomorrow. on monday i expect from your bank the usual phone call "do you accept xx.xx exchange rate?" i'm not a client of Bangkok Bank but all transfers from my banks in Singapore and Luxembourg to my Thai bank have been routed since years through your bank.

if i give you the details by e-mail can you find out in what way (or perhaps not) NY was involved?

[Naam]

on monday i expect from your bank the usual phone call "do you accept xx.xx exchange rate?" i'm not a client of Bangkok Bank but all transfers from my banks in Singapore and Luxembourg to my Thai bank have been routed since years through your bank.

and today i have to report that not Bangkok Bank but Siam Commercial phoned me, asked whether i accept a conversion @ 31.06 (after a little haggling i got a slightly better rate), asked me to confirm that the money is for "personal use" and informed me that the transfer has to be reported to whatever authorities.

[ianguygil]

Many moons ago when being paid in US$ and trying to get them transferred from my offhore bank to my onshore location the bank told me the delay was due to the money having to go though Wachovia Bank in New York and explained that ALL US$ moved around the world went that route.

Naam, can do, I will PM you with my email. You can then post whatever you want. Doing this from my BB in the meeting so I apologise for any errors

Ian

[Naam]

Ian,

did you read my last posting? for the first time no call from your bank but from mine. beats me!

[ianguygil]

Ian,

did you read my last posting? for the first time no call from your bank but from mine. beats me!

The network is so slow here I was still replying to the message before. I'll PM me email now. Sorry. This is too hard via supposed 3G

[topt]

Many moons ago when being paid in US$ and trying to get them transferred from my offhore bank to my onshore location the bank told me the delay was due to the money having to go though Wachovia Bank in New York and explained that ALL US$ moved around the world went that route.

Anglo Irish as was and AIB now quote the same bank as their intermediary bank for all $US transfers. I recenlly transferred from Anglo to SCB Thailand with very little if any delay.

FWIW If I have transfers from Chinese Hong Kong offshore banks they go direct to Thailand with no intermediary bank in the middle as far as I can see.

We also receive a lot of transfers from varoius African banks most of which come direct to the Off shore account again with no intermediary banks.

[jobsworth]

Have you thought about a chop note.

It is very common amongst chinese people.

You give the money to a chinaman in say Thailand.

A chinaman will give the same amount to your supplier in china.

it exists in Singapore.

it gets around all currency restrictions.

it may not be legal and that may be why Kaisikorn did not want to help you.

[muchogra]

To the op: I've found UOB very good as far as remitting money out of Thailand is concerned. A few months ago I went with my BIL to T/T 3 million bahts to a bank in the US. The guy at the desk voluntarily gave us a better rate than the published one on that day. He helped in all the paper work and the whole process took less than 30 min. The money was received the next day at the US bank.

------

Last month I asked my kid to T/T USD9,500 to my KBANK account with no other instructions. My kid was persuaded by the banker to convert the USD to THB there(to lock in the rate - said the banker). That USD9,500 plus USD45 wiring fee turned out to be THB275,000. I looked up subsequently and found that that rate was even worse than the rate for a one dollar bill on that day in any Thai bank. The fund was only received 7 days later. Why so long, I asked the kid. My kid said there was some call received concerning some security issue. ??? The receiving bank here charged another 600 something bahts. I didn't bother to work out exactly the stupid mistake cost cos the deal was already done and it's not a great amount. It's around B10,000 I guess.

I had another lousy deal 2 weeks ago. I had another kid bring in USD10,000 in traveler check. A 2% (USD200) fee was paid when the checks were bought When we cashed the traveler checks at the bank, the published rate on that date was 30.18 to a dollar. The bank charged a fee of B3,000 plus B300 for stamps....another loss of around B10,000 had it been done via T/T correctly. Kids nowadays don't seem bother with details in order to squeeze a few bucks more. Well...

[ianguygil]

So if you can give me a quick description of the transaction I can try to explain what we and the other banks I have worked for would do.

Ian,

i have transferred today a six digit USD amount from my bank in Singapore to my personal account in Thailand and i will do exactly the same tomorrow. on monday i expect from your bank the usual phone call "do you accept xx.xx exchange rate?" i'm not a client of Bangkok Bank but all transfers from my banks in Singapore and Luxembourg to my Thai bank have been routed since years through your bank.

if i give you the details by e-mail can you find out in what way (or perhaps not) NY was involved?

OK, Naam. Here we go.

In the scenario you gave above, it seems that your bank in Singapore is a Correspondent of Bangkok Bank and not of your local bank (I think you said SCB). So you would move xxx,xxx USD to Thailand which means that the Singapore bank would most likely credit their Due To account in USD that we hold with them for the xxx,xxx dollars and would send us a SWIFT payment instruction to credit your THB account at SCB for y,yyy,yyy THB where y,yyy,yyy/xxx,xxx is the Exchange Rate. So we would set the rate (if you did not have an FX Contract) based on our Treasury (for 6 figures you should really get an special FX rate by contacting us first). We would then transfer the funds in y,yyy,yyy THB (minus charges for SWIFT and the Domestic Transfer) by the local clearing system (ITMX or whatever) to the credit of account at SCB. All that detail would have been in the Payment Instruction (SCB as the Beneficiary Bank and you as the Beneficiary) and we are the Intermediary of your bank in Singapore used to clear the funds in Thailand.

So we in Bangkok Bank end up with USD in the bank in Singapore. And we can either choose to build up our position in USD (if the Treasury decides) or we can sell those USD onwards to other customers who need USD.

Please remember that an account is a promise to pay a certain amount in a certain currency on certain terms (maturities, advance notice etc). It does NOT imply that this currency is always maintained on hand, although more conservative banks tend to keep their positions and exposures pretty much in line. It is up to a bank to manage their liquidity (we are an EXTREMELY liquid bank) and their currency positions. As you can see some very illiquid banks can run into problems when their funding dries up. Please think of LEHMAN as the most recent case study, or Northern Rock in the UK. So the implication is that just because we have accounts in USD does not necessarily mean USD in the US.

I our case things are difference because we have a branch in New York. However, our USD accounts are drawn on the Head Office in Thailand. We do use our branch in New York as our correspondent, just as large international banks use their International branch network.

This is a hugely complex subject and I will not clog up this post with too many details. If you PM me I can give you my email. Then you can send me the details of the exact transfers and I can tell you what happened.

The post you gave where you said SCB called to set the rate was probably a case where the bank had a direct correspondent relationship with SCB. So they credited a USD Due To account in Singapore owned by SCB, they sent the Payment Instruction via SWIFT, then SCB called to set the rate with you.

Like I said, PM me and we can discuss.

I can not say exactly what is reported where in the US as it depends on the bank providing the Due To in USD to the Thai bank.

You can definitely transfer USD from Singapore to a USD account in Thailand, we offer more than 10 currencies for Foreign Currency accounts in Thailand, the most recent if which is the Chinese Yuan. This then gives you the option of converting into THB when you want to.

Wow, this was a long post and I thought it would be fast

Ian

Edited October 3, 2011 by ianguygil

[Naam]

The post you gave where you said SCB called to set the rate was probably a case where the bank had a direct correspondent relationship with SCB. So they credited a USD Due To account in Singapore owned by SCB, they sent the Payment Instruction via SWIFT, then SCB called to set the rate with you.

until recently all my transfers (from both SIN banks) were routed via Bangkok Bank from which i got the usual call and an offer for the exchange rate. as already mentioned this time the call came from SCB and now i am waiting that i am called for the second transfer. as soon as this is done i will report.

thanks in advance for your efforts Ian!

[TwentyBaht]

Ian,

I have followed this and other threads regarding Bangkok Bank. And, your excellent postings were a reason for me to open an account with BB several months ago. I now transfer money through the New York Branch to Thailand. And, have had no problems. And, will add that the BB call center is English speaking and helpful.

Thanks for all your help.

[ianguygil]

Ian,

I have followed this and other threads regarding Bangkok Bank. And, your excellent postings were a reason for me to open an account with BB several months ago. I now transfer money through the New York Branch to Thailand. And, have had no problems. And, will add that the BB call center is English speaking and helpful.

Thanks for all your help.

Thank you. Glad it all worked out. We try to make this seamless. I know how frustrating it can be dealing with banks in different countries.

Sorry if I have to get into the internals of Banking at times. Otherwise it is hard to explain what customers experience with SWIFT etc.