DESCRIPTION OF STANDBY LETTERS OF CREDIT (SBLCS)
PRICE TBA
INSTRUMENTS: SBLCS
CURRENCY: EURO (€)/ USD
TERM: ONE YEAR AND ONE DAY
ISSUING BANK: HSBC LONDON;
SETTLEMENT BANKS: HSBC LONDON; BARCLAYS BANK LONDON:
DBS BANK SINGAPORE; CREDIT SUISSE
ZURICH
AMOUNT AVAILABLE: 100M UP TO 50B CONTRACT (ADDITIONAL CONTRACTS
AVAILABLE: CONSECUTIVE OR CONCURRENT)
PROCEDURES TO PURCHASE SBLCS
1) Buyer must have a minimum of 100M Euros/USD in an account OR AN ACTIVE CREDIT
FACILITY with a minimum of 100M Euros/USD in a top 20 bank (preferably banks located in
Western Europe; UK; Canada; USA; Singapore; Hong Kong)
2) Buyer submits the following Compliance documents:
A) Client Information Sheet (CIS)
B) Bank Confirmation Letter - The Buyer’s bank officer sends an email to the provider’s bank
officer, copying in the provider Stating the following “we________Bank confirm with full bank
responsibility that our client_______is in good standing with the bank and there is a
minimum of 100m Euros/USD in the buyer’s account OR that the Buyer’s credit facility is
a) in good standing b) fully collateralized and c) that the Buyer has access to a minimum of
100M Euros/USD”.
3) Provider will verify the bank officer’s IP address – no contact is made with the Buyer’s bank.
(NOTE: the IP Address verification is completed within two hours of the Provider/Titleholder
receiving the bank officer e-mail.) Once the IP address is verified the Provider/Titleholder will
contact the Buyer immediately to arrange the delivery of the SBLCs and a contract.
4) Provider/Titleholder purchases the SBLCs (the SBLCs are available for delivery within 24-48
hours) NOTE #1 THE SBLCS WILL ALREADY BE TITLED IN THE BUYER OR
BENEFICIARY NAME AS PER PREVIOUS INSTRUCTIONS BY THE BUYER.
NOTE #2 THE BUYER DOES NOT SIGN A CONTRACT UNTIL THE SBLCS HAVE BEEN
PURCHASED.
5) Provider/Titleholder will contact the Buyer to confirm that the SBLCs have been purchased
and are ready for delivery and will provide the Contract to the Buyer for signature.
2
NOTE: AFTER RECEIVING CONFIRMATION FROM THE PROVIDER TITLEHOLDER
THAT THE SBLCS HAVE BEEN PURCHASED AND ARE READY FOR DELIVERY THE
BUYER CAN REQUEST A BANK-TO-BANK CONFIRMATION THAT THE SBLCS ARE
AVAILABLE FOR PURCHASE/DELIVERY THIS COMMUNICATION CAN BE IN ANY
FORM SUITABLE TO THE BUYER’S BANKER REQUEST - SEE PROCEDURES BELOW:
IMPORTANT NOTE: THE FOLLOWING PROCEDURES APPLY IF THE BUYER AND
PROVIDER ARE TRANSACTING OUT OF SEPARATE BANKS. IF THE BUYER HAS
FUNDS IN BARCLAYS BANK LONDON; HSBC LONDON; CREDIT SUISSE ZURICH; OR
DBS SINGAPORE THE TRANSACTION CAN BE COMPLETED INTERNALLY.
6) Buyer’s bank sends a MT-799 Request for Confirmation to the Provider/Titleholder’s bank
requesting an MT-799 RWA confirming that the SBLCs are in custody at the
Provider/Titleholder’s bank and available for purchase/delivery. A phone call or email to the
Titleholder/Provider can also be requested. Please note all communications are with a senior
banker from the titleholder side and comes with absolute bank responsibility.
7) Provider/Titleholder’s bank replies with an MT-799 Confirmation SWIFT with full bank
responsibility that the SBLCs have been purchased and are in custody at the
Provider/Titleholder’s bank and ready for purchase and delivery and that upon receipt of the MT-
103 SWIFT payment the SBLCs will be delivered immediately via MT-760 SWIFT into the
Buyer’s account.
NOTE: The Buyer does not send the MT-103 payment until he receives confirmation from his
bank officer that he has confirmed bank-to-bank with full bank responsibility that the
Provider/Titleholder’s bank will deliver the SBLCs as stated in the MT-799 Confirmation
SWIFT.