Bank guarantee

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Revision as of 17:02, 25 March 2021 by imported>Doug Williamson (Typo correction.)
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Trade finance.

A guarantee issued by a bank, in support of a commercial transaction.

The guarantee is a secondary obligation of the bank, called upon only in the event of the failure of a party to the commercial transaction.

Contrasted with a letter of credit, which is a primary obligation of the bank.


See also