US Standby LCs for Construction Projects FG Capital Advisors

Notice. FG Capital Advisors is a trade and capital advisory firm with a focus on carbon, commodities, and structured credit. The firm provides financial modelling, analytical support, and sponsor side advice around commodity finance, trade facilities, and related capital structures. FG Capital Advisors is not a bank, lender, credit insurer, broker dealer, or retail investment adviser and does not issue loans, guarantees, or insurance products. Any facility, guarantee, derivative, or investment is provided by regulated counterparties under their own licences and documentation. All potential transactions are subject to KYC and AML checks, sanctions screening, credit and investment committee decisions, independent legal and tax advice on the client side, and formal agreements with those regulated entities.

Standby LCs For US Construction Projects

You win more contracts when your security is clean, bank-recognised, and issued on time. You protect working capital when you replace cash-heavy solutions with a properly structured standby letter of credit that the owner or prime will accept.

FG Capital Advisors supports US construction companies with SBLC structuring, beneficiary wording alignment, and bank-ready presentation for bid, performance, advance payment, and retention security. We focus on outcomes that matter to you. Faster tender acceptance, smoother contract execution, and less cash trapped in security.

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The Outcomes Construction Teams Buy SBLCs For

Construction standbys are not a theory exercise. They are a tool to secure award, reduce friction with procurement, and keep liquidity available for delivery.

  • Stronger bid credibility when tender rules require bank-backed security.
  • Owner confidence on performance risk without demanding excessive cash blocks.
  • Advance payment protection that supports mobilisation and long-lead procurement.
  • Improved cash flow where retention can be replaced or reduced by a standby.
  • Cleaner cross-border acceptance when project stakeholders want familiar, standardised instruments.

The right structure turns security from a cash drain into a controlled, contract-aligned instrument that helps you execute.

Bid Standby LCs

A bid standby LC helps you compete at the level of larger contractors by proving you can back your offer with credible security. This is often the difference between being shortlisted and being ignored.

  • Aligns instrument tenor to tender validity and award windows.
  • Ensures beneficiary details, project references, and call format match the tender pack.
  • Reduces rejection risk caused by non-compliant wording.

Performance Standby LCs

Performance security protects owners against failure to complete. For you, a well-structured performance standby reduces the need to lock up cash and improves your ability to scale multiple projects at once.

  • Fits EPC, design-build, and general contracting structures.
  • Aligns expiry and any tail requirements to the contract schedule.
  • Supports committee-ready risk rationale for the issuing bank.

Advance Payment Standby LCs

If your contract includes mobilisation or early procurement funding, owners commonly require advance payment security. Done right, this standby protects the owner while preserving your ability to deploy cash rapidly on site.

  • Can be structured with reduction mechanics tied to certified progress.
  • Supports early works and long-lead equipment purchase cycles.
  • Avoids delays caused by unclear amortisation logic.

Retention Replacement Standby LCs

Retention can quietly become your biggest liquidity leak across a multi-project pipeline. Where the contract and owner policy allow it, a retention standby LC can reduce or replace cash retention.

  • Improves working capital predictability across long programmes.
  • Aligns defects liability periods and release conditions.
  • Helps you deliver without starving labour and materials budgets.

Eligibility Fit

This mandate is built for established contractors and well-capitalised subcontractors with real contract flow and the ability to support bank underwriting.

  • Post-revenue construction companies with clear project track record.
  • Active tenders or signed contracts requiring formal security.
  • Clean corporate structure and a credible collateral or reimbursement profile where required.

If your financials and contract package are thin, we will tell you early. That is better than burning tender time on a weak submission.

Fees

We price this service to reflect real underwriting work and issuer coordination. Fees are paid to us for advisory and execution management. Issuer premiums are billed by the regulated bank or guarantor.

  • Engagement fee to FG Capital Advisors. USD 25,000 for SBLCs up to USD 1,000,000. USD 50,000 for SBLCs from USD 1,000,001 to USD 5,000,000. USD 75,000 for SBLCs from USD 5,000,001 to USD 20,000,000. Larger mandates priced on scope.
  • Success fee to FG Capital Advisors. 2.0% of the final face amount, payable upon confirmed issuance.
  • Issuer premium to the bank or guarantor. Commonly 4% to 6% per annum of the instrument amount for a 12-month tenor, subject to credit profile, collateral logic, and beneficiary wording.
  • Third-party costs. Legal, valuation, UCC filings where applicable, and any required insurance confirmations are borne by the client.

These ranges are indicative and refined after intake and beneficiary review.

Closing Procedure

We run a structured, bank-aligned process designed to protect your tender deadlines and reduce back-and-forth with procurement teams.

  • Step 1. Submit your contract or tender pack, beneficiary details, corporate profile, and recent financials.
  • Step 2. We confirm instrument type, amount, tenor, and the closest compliant wording pathway.
  • Step 3. Engagement fee is paid. We build a bank-ready submission file and risk rationale.
  • Step 4. We introduce the package to regulated issuers aligned with your size, sector, and timeline.
  • Step 5. Issuer issues a term indication and confirms collateral or reimbursement requirements.
  • Step 6. You complete KYC and any collateral perfection steps required by the issuer.
  • Step 7. Final instrument is issued to the beneficiary under the issuer’s documentation. Success fee becomes due on confirmed issuance.

FAQ

Can you guarantee issuance

  • No. Issuance is a regulated bank decision based on credit, contract risk, and compliance. Our role is to improve the quality and speed of your submission.

How fast can a construction SBLC be arranged

  • Timelines depend on contract complexity and your financial profile. Clean files with clear beneficiary wording move faster than last-minute, incomplete submissions.

What collateral is required

  • Requirements vary by issuer and risk profile. Some structures rely on balance sheet strength and reimbursement covenants. Others require cash or asset-backed support.

Do you support subcontractors

  • Yes, when the subcontractor has the scale, financial capacity, and contract documentation to meet issuer standards.

Is a standby LC the same as a bank guarantee

  • In construction practice they often serve similar purposes. The governing rules and wording format can differ, so we align the instrument to what the beneficiary will accept.

Can a standby LC replace retention

  • Sometimes. It depends on the owner’s policy and contract language. We can review your contract to confirm feasibility before you commit.

What do you need from us to start

  • The tender or contract pack, beneficiary details, amount and tenor requested, corporate documents, and recent financials.

Do you work only in the US

  • This page is focused on US construction contracts. Cross-border projects can be reviewed case by case where US-based applicants need international acceptance.

You do not need a standby LC that looks good on paper. You need one that is accepted by the beneficiary, issued on time, and aligned with your contract risk so you can keep building instead of chasing security corrections.

If you have an active tender or a signed construction contract requiring bid, performance, advance payment, or retention security, submit your details for a structured quote and a bank-ready pathway.

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Disclosure. FG Capital Advisors provides financial modelling, analytical, and advisory services. The firm does not originate, offer, or sell securities, loans, deposits, guarantees, or insurance products and does not accept client money. Any instrument referenced on this page is described for professional and commercial context only. Nothing on this page is a recommendation or a solicitation to buy or sell any security, fund interest, token, derivative, or financial product. Any SBLC, guarantee, or related facility is provided by appropriately regulated banks or guarantors under their own licences, terms, and documentation. All engagements with FG Capital Advisors are subject to internal approval, conflict checks, and applicable KYC and AML checks and sanctions screening where required, as well as the terms of a formal engagement letter.