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Guarantee
 
Financing Guarantee (Loan Guarantee)
CMB issues a Letter of Guarantee (L/G) to a financial institution (lender), guaranteeing repayment of a loan approved by the lender to a borrower designated by you.
Benefits
Credibility enhanced: Credit standing of your overseas subsidiary or affiliate is assured when they apply for a loan to its local bank.
Going-global propelled: CMB’s guarantee helps you raise funds abroad and execute your going global strategy.
Various applications: CMB’s guarantee can be used to apply for financial leasing, overdraft credit line, securities issuance, etc.
Tender Guarantee/Bid Bond
At the request of you as a bidder (tenderer) CMB issues a written undertaking to the tenderee, guaranteeing that in the validity period of bid you won’t withdrew or modify your tender without tenderee’s consent, and will sign the contract and/or provide performance bond within the time limit once your tender has been accepted by the tenderee.
Benefits
Capability enhanced: CMB’s undertaking is a significant credit to help you win the negotiation and bid.
Margin deposit saved: CMB’s undertaking eliminates the need for you to place margin deposit with the tenderee, thus increasing your financial efficiency.
Performance Bond
CMB issues a written undertaking to another party of your contractual relationship, guaranteeing that you will strictly fulfill your obligations of a contract of construction project, procurement and shipbuilding, etc.
Benefits
Capability enhanced: CMB’s undertaking is a significant credit to help you win the negotiation and contract.
Margin deposit saved: CMB’s undertaking eliminates the need for you to place margin deposit with the other party, thus increasing your financial efficiency.
Completion of contract: CMB’s undertaking ensures the other party that your contractual obligations will be performed, and compensation will be paid if you fail to perform.
Advance Payment Guarantee
CMB issues a written undertaking to another party of your contractual relationship (beneficiary), guaranteeing that you will strictly fulfill your obligations of a contract after the beneficiary has paid you an advance payment, which is widely used in a contract of construction project, procurement and shipbuilding, etc.
Benefits
Capability enhanced: CMB’s undertaking is a significant credit to help you win the negotiation and contract.
Margin deposit saved: CMB’s undertaking eliminates the need for you to place margin deposit with the other party, thus increasing your financial efficiency.
Completion of contract: CMB’s undertaking ensures the beneficiary that your contractual obligations will be performed, and the advance payment and/or compensation will be paid if you fail to perform.
Payment Guarantee
CMB issues a written undertaking to another party of your contractual relationship (beneficiary), guaranteeing that you, as a debtor, are capable of fulfilling your payment obligations of a contract.
Benefits
Capability enhanced: CMB’s undertaking is a significant credit to help you win the negotiation and contract.
Margin deposit saved: CMB’s undertaking eliminates the need for you to make advance payment to the other party, thus increasing your financial efficiency.
Completion of contract: CMB’s undertaking ensures that the beneficiary will fulfill his contractual obligations to supply goods and/or perform service, etc.
Easier to operate: This kind of undertaking is much easier and more flexible to operate than a Letter of Credit (L/C).
Guarantee for Customs Duties
CMB issues a written undertaking to the customs authority, guaranteeing that you will fulfill your payment obligations of customs duties in the case of your importing products and goods before the tax concession policies are issued by the state; of your equipment, appliances and other items temporarily entering another country during the construction and performing of overseas projects, overseas exhibition and trade fair; of your importing materials for the purpose of processing trade; or of the customs applying a “release-first and tax-later” policy on some goods.
Benefits
Capability enhanced: CMB’s undertaking is a significant credit to facilitate your communication with the customs authority.
Financial efficiency increased: CMB’s undertaking eliminates the usual need for you to deposit some money with the customs authority, and postpones your payment of duties, thus increasing your financial efficiency.
Easy clearance of customs: CMB’s undertaking helps you simplify and speed up the customs clearance of goods, and avoid the cost caused by goods stranded at port and/or the trouble of drawback procedures for goods temporarily entering another country.
Quality/Maintenance Guarantee
CMB issues a written undertaking to the buyer of your product or the owner of a project completed by you, guaranteeing that you will fulfill your contractual obligations in the warranty or maintenance period.
Benefits
Capability enhanced: CMB’s undertaking is a significant credit to help you win the negotiation and contract.
Financial efficiency increased: CMB’s undertaking eliminates the usual need for you to deposit some money with the buyer/owner, thus increasing your financial efficiency.
Completion of contract: CMB’s undertaking ensures the buyer/owner that your product and/or project are in compliance with the terms and conditions agreed between you and the buyer/owner.
Retention Money Guarantee
CMB issues a written undertaking to the buyer of your product or the owner of a project completed by you, guaranteeing that you will fulfill your contractual obligations if the buyer/owner releases the “retention money”.
Benefits
Capability enhanced: CMB’s undertaking is a significant credit to help you win the negotiation and contract.
Financial efficiency increased: CMB’s undertaking eliminates the usual need for the buyer/owner to retain some money with them to secure your contractual obligations in the final phase, thus increasing your financial efficiency.
Completion of contract: CMB’s undertaking ensures the buyer/owner that your contractual obligations of the product and/or the project are to be fulfilled by you even though no “retention money” is held by the buyer/owner.
Deferred Payment Guarantee
CMB issues a written undertaking to an exporter of goods, a provider of technology and labor service or a performer of engineering project (beneficiary), guaranteeing that your payment obligations will be fulfilled in a contract with deferred payment or usance payment terms.
Benefits
Capability enhanced: CMB’s undertaking is a significant credit to help you win the negotiation and contract.
Financial efficiency increased: CMB’s undertaking facilitates you to reach an agreement with the beneficiary on more favorite payment terms, thus increasing your financial efficiency.
Shipping guarantee
CMB issues a written undertaking to a shipping company carrying the goods imported by you, guaranteeing that you can take possession of the goods without producing shipping documents, which arrive later than goods in the case of Letter of Credit (L/C).
Benefits
Capability enhanced: CMB’s undertaking is a significant credit to help you communicate with the shipping company.
Earlier delivery of goods: CMB’s undertaking allows you to take delivery of goods earlier than the arrival of shipping documents.
Financial efficiency increased: CMB’s undertaking eliminates the storage fees or demurrage charges possibly occurred to you, and offers you a chance to sell goods earlier, thus increasing your financial efficiency.
Note:
All the contents stated above are for your reference only. Please consult the local branch of China Merchants Bank for further information. China Merchants Bank reserves the ultimate right of interpretation for the contents in this page.