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The Central Bank decides to allow the United Bank to issue letters of guarantee


yota691
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Economy News - Baghdad

The Central Bank of Iraq has decided to allow the United Investment Bank to issue new letters of guarantee.

The "Economy News" received a document issued by the Central Bank of Iraq in which it decided to allow the United Bank to invest in issuing new letters of guarantee, after the previous decision to stop issuing.


Views 47   Date Added 14/04/2019

 
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4 hours ago, yota691 said:

The "Economy News" received a document issued by the Central Bank of Iraq in which it decided to allow the United Bank to invest in issuing new letters of guarantee, after the previous decision to stop issuing.

 

What is a Letter of Guarantee 

A letter of guarantee is a type of contract issued by a bank on behalf of a customer who has entered a contract to purchase goods from a supplier. The letter of guarantee lets the supplier know that they will be paid, even if the customer of the bank defaults. To get a letter of guarantee, the customer will need to apply for it, similar to a loan. If the bank is comfortable with the risk, they will back the customer with the letter, for an annual fee.

 

https://www.investopedia.com/terms/l/letter_of_guarantee.asp

 

What is a Letter Of Credit? 

A letter of credit is a letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. In the event that the buyer is unable to make payment on the purchase, the bank will be required to cover the full or remaining amount of the purchase.

 

Due to the nature of international dealings, including factors such as distance, differing laws in each country, and difficulty in knowing each party personally, the use of letters of credit has become a very important aspect of international trade.

 

https://www.investopedia.com/terms/l/letterofcredit.asp

 

Looks like internal to Iraqi, the Bicraqi Iraqi Bank United Bank is issuing NEW Letters Of Guarantee. So, looks like internal Bicraqi Iraqi manufacturing, etc. is anticipated to get rolling. The Letter Of Credit is an INTERNATIONAL facilitation of trade that appears to NOT be in the news - yet.

 

At least a step in the RIGHT direction with NEW Letters of Guarantee being issued!!!

 

Go Moola Nova!

:pirateship:

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