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Raising Credit Lines (‘Monetizing’) Bank Guarantees

• Use the Guarantee as credit or loan security
• High LTV’s due to being ‘instantly liquidable’
• Strong Covenants
• Internationally Accepted

Bank Guarantees received under Collateral Transfer facilities may be used by the Beneficiaries to secure credit lines at their bank. Typically, a banker will have no objection to offering credit against Bank Guarantees received in this manner up to 100% of face value, less of course advance interest charges and bank fees. However, typically lending rates (loan to value or LTV) will be around 80% to 90% of face value. The total credit term can be for the duration of the Guarantee, i.e. 1 to 5 years, but of course will not exceed the term (or expiry) of the Guarantee.

The Guarantees that are issued under these types of facilities are worded specifically to secure credit lines. Guarantees are issued under ICC758 protocol and are readily accepted by all international and private banks. Often they are called ‘Letters of Guarantee’ or ‘Credit Facilities Guarantees’.

Arawak Capital can of course assist its clients in raising credit against guarantees of this type in the event that our clients own bank declines to offer lending facilities. We hold strong relationships with understanding banks and private equity groups holding an appetite to expand lending opportunities in this area. It should be noted however that additional fees will apply if you utilise our services to obtain credit lines.

Arawak Capital can also open banking and lending facilities for its selected clients by direct introduction to the willing bank. Please enquire for a detailed quotation.

It is of course common sense that you first need to be approved for receiving the Bank Guarantee prior to applying for credit against it.

All Bank Guarantee (BG) Standby Letter of Credit (SBLC) Medium Term Note (MTN), Bond issue transactions must be completed via SWIFT ONLY.  Please make sure your financial institution has SWIFT capabilities.

Our group takes great precautions in protecting your interest, confidentiality, and money.

We welcome you to contact us today to discuss your scenario.