Standby Letters of Credit
An undertaking by a bank on behalf of its Customer that a payment will be made at some future date in the event of a specified occurrence, standbys are commonly issued in favor of suppliers to support the ongoing purchase of goods and in cases where banks are precluded by law from issuing letters of guarantees.
- When a foreign buyer requires a bid bond/tender, advance payment or performance guarantee to support a foreign contract, the issuing bank can structure and issue a guarantee on behalf of the exporter either directly to the buyer, or indirectly through one of our correspondent banks in the buyer's country
- Standby letter of credit applications can be completed and transmitted to TD Bank electronically via TD Bank Trade
- Facilitates exporters conducting business in international markets (tender process and contract completion)
- The client must have a credit facility in place in order to request that a standby letter of credit be issued