These Bank Guarantees support Commodity Trading in Bulk

JW MORRIS October 20, 2021 0 Comments

Bank Guarantees support Commodity Trading in Bulk

How to issue an SBLC to your commodities seller on a back to back basis!

There are many situations in which bank guarantee instruments are used and very helpful. A bank guarantee instrument can be sent by a collateral provider to the client’s own bank to directly trigger cash from a loan, and with this liquidity for the beneficiary. Or it can be sent to a monetizer or funder.

But it can also be used in back to back transactions at a client’s own bank to facilitate large or long term commodity transactions. Clients in the Oil and Gas industry or engaged in trading of agricultural commodities use such instruments to secure prices and annual contracts. If for any reason, the trader’s own bank does not issue an instrument for the importer to be sent to an exporter of refined or crude oil, cement, sugar, wheat or any other commodity, then a back to back transaction can be the solution.

On the basis of the (initial) bank guarantee instrument sent to the buyer’s own bank in the form of a Bank Guarantee or Standby Letter of Credit (SBLC), the receiving bank can issue its own fully cash backed, divisible and assignable BG or SBLC instrument for the client to any supplier, anywhere.

• Letters of credit are also financial promises on behalf of one party in a transaction and are especially significant in international trade.
• Bank guarantees are often used in real estate contracts and infrastructure projects, while letters of credit are primarily used in global transactions.

So if a client needs to secure a shipment through a financial instrument, the guarantee instrument can be sent directly to the supplier if the supplier is a part of the borrowing and lending transaction and complies with the lending terms. If such a Joint Venture between the seller and the buyer is not an option, the fully cash backed, divisible and assignable financial instrument can be sent to the buyer’s own bank on the regular borrowing and lending terms, and his bank will then issue an instrument on a back to back basis, to the seller’s bank, and this second guarantee instrument can even be without any conditions or restrictions.

A quick summary:
1. If there is a need to guarantee for your commodity trading, a BG or SBLC can be sent either directly to an exporter or supplier.
2. A second, back to back instrument can be issued to a seller on the back of the initial instrument sent to a buyer’s own bank and this second instrument sent to the seller can be unrestricted and without conditions.
3. An applicant will have to be of basic financial substance.
4. The receiving bank of the instrument will have to be prepared to issue or endorse a payment instrument for the borrowing and lending fees.
5. The receiving bank will have to confirm that it will return the financial instrument 15 days prior maturity, in case the service is not renewed on time.
6. If such confirmation is not available, the client can purchase a bond to compensate the potential risk of lending valid collateral.
7. If the receiving bank of the first instrument is not the client’s own bank, the seller, funder, or monetizer will have to become contractual partner of the borrowing and lending transaction.

We prefer to work with qualified clients. Chances to materialize a transaction can be very high. If you would like to discuss any of these options for your immediate business, please use the reply form, or call 00353860325153

This number also works on Whatsapp, Signal, Telegram and WeChat.

Does your own banker ask for a collateral “PRE-ADVICE”?

Your banker would provide you with funding if you came up with collateral? Would he be happy to help if ...
Read More

So you are qualified to receive a loan or borrow a bank instrument?

So you are qualified to receive a loan or borrow a bank instrument? When you seek credit support, is your ...
Read More

Validity Term in a Borrowing and Lending Transaction

ICC 600 URDG 758 and ISO15022International Chamber of Commerce (ICC) and International Organization for Standardization (ISO) In a Borrowing and ...
Read More

This is how you can pay for Borrowing and Lending fees only after 180 days!

We deliver a highly rated Financial Instrument to you now, and you only pay for it later! With the ...
Read More

In a Back-to-Back transaction you can issue your own bank guarantee instrument!

When negotiating terms to issue a bank guarantee instrument with any bank, a BG or an SBLC for a certain ...
Read More

Why there is a Reservation Call Option Fee requirement?

A client will have to have a complete understanding of the transaction basics and know how we generate genuine instruments ...
Read More

What do you need to borrow genuine and verifiable Prime Bank collateral?

What do you need to borrow genuine and verifiable Prime Bank collateral? The consent of your bank to issue a ...
Read More

This is how you can get a Loan to start your Project right now

Do you need a Business Loan, or would like to start a Project right now? You have a bank, an ...
Read More

How to rent Financial Capacity to leverage your Investment Possibilities

You can now rent financial capacity and leverage your investment possibilities and benefit from high yielding Private Placement Programs! ...
Read More

These Bank Guarantees support Commodity Trading in Bulk

Bank Guarantees support Commodity Trading in Bulk How to issue an SBLC to your commodities seller on a back to ...
Read More

This monetizer can fund against borrowed financial Prime Bank collateral

Monetization can be a great way to get a project in funds and there are clients served who are successful ...
Read More

The aim of our Bank Guarantee Collateral Program

Bank Guarantees are powerful collateral for an agreed upon period of time, provided on the basis of collateral borrowing and ...
Read More

This is how you can expect a High Net Worth Investor to risk his cash funds for you and provide you with a valid, fully verifiable Bank Guarantee or Standby Letter of Credit

Do you need a business loan, or would like to start a project right now? You have a bank, an ...
Read More

Steps to a successful transaction.

This summary explanation is available for educational purposes only and explains how Securities Borrowing and Lending is utilized by qualified ...
Read More

If you are qualified, we can provide all the collateral you need!

We lend highly rated Securities in the format of an SBLC or BG to back up your Credit Line ...
Read More

Why should a client be qualified to receive a multi million Euro bank guarantee instrument?

The instrument that you probably seek should be valid and fully verifiable, correct? If an instrument is genuine it is ...
Read More

The way you can expect a third party to provide you with a valid, fully verifiable cash backed, divisible and assignable Bank Instrument.

If you are interested to obtain a valid fully verifiable Bank Guarantee instrument from a third party to trigger a ...
Read More

Pennies can help you access valid BG or SBLC collateral – issued for you on the back of highly rated, verifiable and publicly listed Securities

You are in contact with us, probably since the banks you deal with do not provide a bank guarantee service ...
Read More

“Solving financial issues through Credit Enhancement”

You can directly download the Summary of the eBook "Solving financial issues through Credit Enhancement" by Geordon Saraveloz here You ...
Read More

Here is how you can access Credit Enhancement

Credit Enhancement and what is available in your situation?Here you will learn about terms and concepts and available working procedures ...
Read More

The Leverage Effect.

Opportunity explained: The Leverage Effect. In business, credit enhancement is usually applied to make a company more creditworthy to reduce ...
Read More

This is the bank that has never asked for any money in advance!

This is the bank that has never asked for any money in advance! – Isn’t that really good news? ...
Read More

Prime Bank Instrument without advance fees. This is how we even advance the call option fees for you and issue a Prime Bank instrument for you!

There is a call option fee to be placed for this transaction to block the securities which build the basis ...
Read More