Introduction

In international trade and structured finance, trust and proof of capacity are critical before engaging in large-value transactions.
An RWA Statement (Ready, Willing, and Able Statement) is a formal document issued by a bank or financial institution confirming that its client is financially capable and ready to execute a specific transaction — such as an SBLC, LC, or Bank Guarantee (BG).

This instrument is not a payment commitment but rather a financial comfort letter that demonstrates readiness and credibility in trade dealings.

Keywords: Ready Willing Able definition, financial capability letter, trade finance comfort letter, SWIFT MT799, financial readiness
Related terms: proof of funds, pre-transaction assurance, MT199/MT799 message, financial due diligence

I. Definition of an RWA Statement

An RWA Statement (Ready, Willing, and Able Statement) is a bank-issued document confirming that a client:

1. Is Ready – has completed internal compliance checks and documentation.

2. Is Willing – has authorized the bank to proceed with the proposed financial transaction.

3. Is Able – possesses the financial resources to honor the obligations tied to the trade or investment.

In essence, it is a formal banking assurance validating that the client is both legally and financially prepared to complete the deal.

II. Purpose and Use in Trade Finance

The RWA statement is often used as a preliminary step before the issuance of a Standby Letter of Credit (SBLC), Letter of Credit (LC), or Bank Guarantee (BG).

It serves as a comfort signal to counterparties and banks, particularly in high-value international transactions where proof of funding and seriousness must be demonstrated prior to execution.

Typical scenarios include:

• Pre-qualification for an SBLC or BG transaction

• Confirmation of buyer’s capacity in commodity trade deals

• Verification of financial backing for large project finance proposals

• Supporting documentation for counterparty due diligence

III. Message Format: SWIFT MT799 Communication

RWA statements are typically transmitted through the SWIFT network using MT799 messages — a free-format message type used for interbank correspondence.

This message allows the issuing bank to communicate the readiness and capacity of its client in an authenticated and traceable manner.

Sample SWIFT RWA Statement (Simplified Extract):

“We, [Bank Name], on behalf of our client [Client Name], hereby confirm that our client is Ready, Willing, and Able to engage in the transaction as per agreed terms. This message is transmitted for information and comfort purposes only and does not constitute a guarantee or undertaking.”

IV. Legal and Compliance Considerations

Although the RWA statement provides assurance, it is not a legally binding financial instrument.
It carries no obligation to pay and must not be misconstrued as a guarantee or LC.

To ensure compliance, the following must be observed:

• KYC and AML verification of both parties prior to issuance

• Transmission through authenticated SWIFT channels (MT799 or MT199)

• Inclusion of clear disclaimers preventing misuse or misrepresentation

• Regulatory adherence to central bank and anti-fraud guidelines

Banks issue RWA statements only after verifying the client’s funds, mandate, and authorization for the transaction.

V. Importance in International Trade and Finance

RWA statements hold strategic value in trade and project finance due to their ability to:

• Establish initial trust and credibility between unknown trading parties

• Expedite financial due diligence and readiness verification

• Facilitate the swift issuance of instruments like LC, SBLC, or BG

• Serve as a non-binding but essential assurance for initial deal structuring

In global trade transactions exceeding millions of dollars, such statements play a crucial role in reducing negotiation friction and aligning institutional confidence before formal instrument issuance.

VI. Common Misunderstandings and Misuse

Despite their importance, RWA statements are often misused or misinterpreted in fraudulent schemes.
Unscrupulous intermediaries may claim to hold RWA statements without authentic bank backing.

Red flags to watch for:

• RWA documents not sent via SWIFT

• Use of generic templates without bank letterhead or BIC

• Absence of authorized bank signatories

• Unverifiable or inconsistent client information

Authentic RWA statements must originate directly from the issuing bank via SWIFT communication and contain verifiable transaction references.

Conclusion

An RWA Statement acts as a pre-transaction assurance tool, confirming that a client has the financial strength and institutional readiness to complete a transaction.
While non-binding, it provides the foundation of trust necessary for the issuance of formal instruments such as SBLCs, LCs, or BGs.

For professionals in trade finance, project funding, and structured credit, understanding the function and limitations of RWA statements is essential to prevent fraud, streamline negotiations, and maintain compliance integrity.

FAQ — What is an RWA Statement?

Q1 — Is an RWA statement a guarantee or a Letter of Credit?
No. It is a comfort letter confirming financial readiness, not a payment commitment.

Q2 — Who issues the RWA statement?
It is issued by a client’s bank or authorized financial institution through SWIFT MT799.

Q3 — When is an RWA used?
Before formal issuance of SBLC, LC, or BG, or during pre-qualification in major trade or project transactions.

Q4 — How can one verify a genuine RWA statement?
By checking its SWIFT origin, reference number, and authorized bank signatory.

Q5 — What risks are associated with fake RWA statements?
Fraudulent or non-bank-issued RWAs can lead to financial loss, reputational damage, and compliance breaches.