Page 197 - A Banker Down the Rabbit Hole

We got a telex message in next 2 days for TT reimbursement confirming
the documents were not discrepant in terms of LC. TT reimbursement
meant that immediate payment to be made in 48 hours in New York
account of the negotiating bank. We did not send payment instructions
to our correspondent bank to pay.

Within next 3 days we received the documents with certificate that
documents have been checked and found in order as per LC. The CFO of
the company called on us again and requested us to check the documents
carefully and also at the earliest to minimize the interest cost on USD
600,000 in case bank has to pay when documents are found in order. We
had a dual pressure of perfect performance and that too with speed. I
requested my concerned Junior Manager to work late and finish the
checking of documents and hand over to me for my double checking
during the night, to make sure any discrepancies are brought out because
the 'Negotiating Bank in India' was sending telex after telex to honor
payment for these documents.

He handed over the documents to me around 8 pm declaring them as
non-discrepant. I carried them home against the norms of the office. After
some rest and dinner, I started rechecking them independently. We had
to be very careful. The customer would not accept documents if they
found it genuinely discrepant in a minor or major way as this was their
right to reject. Then the bank had the liability of these documents as we
might be paying for documents already. To get back the amount paid for
discrepant documents from the negotiating bank would be a great
struggle and would invite immediate adverse reaction from our bank
management too.

During my checking, I found a "Certificate of Analysis of Quality" where
the upper limits of percentage of presence of some specified elements
in iron ore were mentioned. These had to be matched with the terms of
LC. Among several other elements, one of them was Sulphur that was
stipulated not to exceed 0.2% as per Letter of Credit terms. I found it

194 | A Banker down the Rabbit Hole