According to SWIFT data tracking MT700 - code for LC - messages, which includes the value of transactions, increased 118% in 2012, compared with 2011. Furthermore, import messages increased by 42% over same period, making a bumper year for LCs.

It is thought that the main reason for this is increased trade with China, which is in line with their strong GDP growth of 6.3% in 2012, and possible concerns about counter-party risk in open account trading.

Overall, LCs have been on the decline as instruments for settling international trade for a long time. They used to comprise 20-30% of all trade 10 years ago, now it is 10-15% according to SWIFT data.