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Letters of Credit

Letters of Credit

Start new business relationships or strengthen existing ones. A letter of credit helps you make purchases and transactions, even if you have limited trading experience or credit history with these new business partners.


A standby letter of credit assures that your business will meet its contractual obligations to a third party, giving them great peace of mind. They can also replace the need for costly insurance bonds.

Summary
  • Guarantees you will make payments on large purchases
  • Typically issued for a 1-year term or less
  • Terms easily renewed
  • Fee is based on the face value amount
  • Interest accrues only if beneficiary requests an advance
  • Cash or marketable securities are generally used to secure the credit
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