STANDBY LETTER OF CREDIT (SBLC)

The Standby Letter of Credit (SBLC) to be monetized must be issued by any of the top 25 AAA rated banks in USA, Switzerland, Germany, London or France such as JP Morgan, HSBC, Citibank, Barclays, Stanchart etc. Standby Letter of Credit (SBLC) from unrated banks cannot be monetized.
 

Required Paperwork, Our Standard Process & Our Fees:

Once the client has provided us with their CIS/KYC and a copy of their instrument (BG, SBLC, MTN, etc.) we verify the document by looking for the ISIN# or CUSIP#. If the document is fresh cut, we ask for treasury documents to authenticate the instrument or the widely seasoned instrument.
 

The Credit Process

STEP 1: ISSUANCE of MT799

To initiate the transaction, we would first need the client to provide us with MT799 (which is the proof of funds) from his bank. Please see below for the format of MT799 acceptable to us:

STEP 2: KYC PROCESS

Upon receipt of the MT799 (proof of funds), we will proceed to conduct KYC on the client. Kindly note that KYC is an important aspect of SBLC financing.

For a start, the preliminary due diligence information required would include:

• Identity and background of the Borrower / Principal.

• If the SBLC applicant is not the Borrower / Principal, we would also need the identity and background of the SBLC applicant, as well as his relationship with the Borrower / Principal.

• Amount and Purpose of the loan.

• Financial statement of the SBLC applicant and the Borrower

• Where necessary, we may subsequently ask for additional information.

STEP 3: CREDIT SUBMISSION

Upon receipt of the MT799 (proof of funds) and satisfactory due diligence conducted by us, we will then present the request to the CC for formal approval on the transaction, including the commercial terms.

Requirements for SBLC financing

For SBLC, we typically financed at LTV of 80% (in the same currency) and only on SBLC that fulfills all of the following requirements:

A. The SBLC is to be in the following format:

• If the Borrower is the applicant of the SBLC, please use this format:-

• If a third party (not the Borrower) is the applicant of the SBLC, please use this format:-

• Kindly note that the SBLC texts (as attached above) are non-negotiable.

B. The SBLC has to be issued by a Tier 1 bank (i.e. Banks that has a Credit Rating of at least A- from S&P or A3 from

    Moody’s) and the bank's size (relatively to the loan size) has to be acceptable to us.