Notice. Advisory services only. Not a lender. Any facility is subject to counterparty approvals, due diligence, KYC and AML, regulatory constraints, and definitive documentation. Information is indicative and may change without notice.
Standby Letter of Credit (SBLC) — Issuance & Confirmation
What We Deliver
We arrange SBLC issuance, confirmation, and related LC structures for qualified importers, project sponsors, and distributors. The work covers counterparty mapping, term sheet negotiation, documentation, bank coordination, and conditions precedent to first effectiveness.
Structures
- SBLC under ISP98 or UCP600
- Usance LC with discounting or UPAS mechanics
- Confirmed LC for cross-border risk mitigation
- Back-to-back LC chains and red clause where eligible
- Performance and financial standby variants
Typical Parameters
- Ticket size: 5,000,000 to 250,000,000 USD
- Tenor: 90 to 365 days for trade cycles; up to 24 months for standby use cases
- Issuing and confirming banks: tiered by jurisdiction and sector appetite
- Pricing: issuance fee, confirmation margin, and discounting per schedule
Eligibility and Required Materials
Eligibility
- Documented supply or offtake with clear delivery and pricing terms
- Operational capability for logistics, storage, and inspection where relevant
- Demonstrable payment performance or pilot history
- Governance, signatories, and clean sanctions profile
Initial Materials
- Counterparty details and draft instrument text
- Commercial contract with Incoterms, schedules, and QC rules
- Financials, bank statements, and funding plan for charges
- Hedging policy where commodity or FX risk is present
An intake checklist and data room index are issued at mandate. Transactions move forward when core materials are complete.
Risk Controls and Execution
Controls We Push For
- Clean instrument wording with precise presentation rules
- Confirmation based on country, bank, and sector risk
- Draft review cycle with applicant and beneficiary alignment
- Escrow, inspection, or collateral where required by counterparties
- Sanctions, AML, and UBO checks across all parties
Execution Timeline
- Week 1: eligibility screen, draft text, and bank shortlists
- Weeks 2–3: term sheets, KYC package, and confirmor engagement
- Weeks 4–5: credit approvals, documentation, and CP schedule
- Week 6: issuance and, if applicable, confirmation effectiveness
Sample Term Sheet (Illustrative)
| Applicant | Importer, distributor, or project SPV |
|---|---|
| Beneficiary | Supplier or contracting counterparty |
| Instrument | Standby Letter of Credit subject to ISP98 or UCP600 |
| Face Amount | Up to 250,000,000 USD, with step-up subject to performance |
| Tenor | Up to 365 days; extensions by mutual agreement |
| Purpose | Payment security, bid or performance support, advance payment protection |
| Issuer | Approved bank subject to KYC and credit capacity |
| Confirmation | Optional by an approved confirming bank based on jurisdictional risk |
| Pricing | Issuance fee and confirmation margin per risk band; discounting if usance/UPAS |
| Documents for Drawing | As per instrument text, typically statement of non-payment or performance default, or presentation set under usance LC |
| Conditions Precedent | KYC and AML, draft approval, legal opinions where applicable, fee payment, and CP list completion |
| Governing Rules | ISP98 or UCP600; governing law for related agreements as agreed (England and Wales or New York) |
Illustrative only. Final terms are set in definitive documents after underwriting and bank approvals.
Open Client Intake
Request a quote or book a consultation. We structure drafts, secure issuance and confirmation, and coordinate documentation to effectiveness.
Open Client IntakeFAQs
Which rules apply to the SBLC?
Most standbys follow ISP98. Where appropriate, UCP600 can apply. The choice affects drafting and presentation mechanics.
When is confirmation required?
When issuer, country, or sector risk warrants additional protection. Confirmation pricing depends on risk band and tenor.
Can the LC be discounted?
Yes for usance or UPAS structures. Discounting turns deferred payment into immediate liquidity at agreed margins.
What slows approvals?
Incomplete KYC, unclear instrument text, sanctions flags, and unaligned contracts. Clean drafts and full packs shorten timelines.
Disclosures. No guarantee of approval, pricing, or timing. All steps are subject to bank processes, compliance clearance, and document completion.
