L/G and L/C

Product Introduction

Letter of Guarantee is a written commitment issued to the beneficiary by the guarantee bank upon the request of the applicant in order to ensure that the applicant fulfills its obligations under the contract which the applicant signs with the beneficiary. Standby L/C is another form of L/C; usually it has the same functions as a letter of guarantee.

Product Features

1.        They replace commercial credit with bank credit, and solve the problem of mutual distrust between the parties in a contract, thus facilitating contract execution.

2.        Their applicable range is extensive; according to the types of basic trade they base, they can be divided into letter of guarantee for bidding, letter of guarantee for contract fulfillment, letter of guarantee for advance payment, letter of guarantee for quality, letter of guarantee for payment, letter of guarantee for financing, and letter of guarantee for rental.

3.        Flexible and diversified formats¡ªThe formats are customized according to projects and customer needs, not limited to one type.

4.        A standby L/C is applicable to the Uniform Customs and Practice for Documentary Credits (UCP) or International Standby Practice (ISP). A letter of guarantee can be applicable to the Uniform Rules for Demand Guarantees (URDG), Uniform Rules for Contract Bonds (URCB), or selected laws. In which, a demand bank letter of guarantee or standby letter of guarantee, the payment responsibility undertaken by the bank is irrevocable, independent of the basic contract, documented, and bound.

Our Commitments

1.        By utilizing our extensive agency bank networks at home and abroad as well as comprehensive variety of letter of guarantee business, our bank can meet your various needs for the letter of guarantee business; the processing procedure is handy.

2.        Flexible pricing is implemented according to the customer¡¯s credit standing and contract fulfillment capacity, the amount and term of the letter of guarantee, and the credit standing, nation and region of the beneficiary of the letter of guarantee.

Kind Reminders

1.        You shall provide our bank with such information as your financial statement and your need for a letter of guarantee, and apply for a credit line for issuing the L/C without full deposit margins. Otherwise, you will have to pay a full-amount deposit margin.

2.        Every time you entrust our bank to issue a letter of guarantee, you shall submit the following documents:

(1)       The L/C issuance application form signed and affixed with the seal by the applicant;

(2)       Background documents of the letter of guarantee, which include the contract and the approval document issued by related departments;

(3)       Related letter of guarantee format with an official seal.

3.        The clauses of a letter of guarantee can be very diversified; if they are handled poorly, and the responsibilities and obligations of the parties are not defined clearly, there will be unnecessary disputes; therefore, please contact our customer manager before you sign the contact, and listen to the opinions of the professionals of our bank.

4.        Our bank suggests that the applicable laws for the issuance of a letter of guarantee be the laws of China or international practices in stead of the laws of other countries. Otherwise, the risks in the fulfillment of the L/C will be greatly increased.