Corporate
Trade finance
Guarantee

Guarantee

A guarantee is a written commitment issued by one of the parties (principal) in favor of the other party of the contract (beneficiary). By means of a guarantee we undertake a commitment to pay a certain amount to the beneficiary in case of failure of the principal to duly honour its obligations to the beneficiary.

When issuing guarantees and executing transactions for servicing foreign trade we are governed by the rules designed by the International Chamber of Commerce (terms of issuance/service and types of guarantees, payment terms, etc.).

Major Terms of Issuing Guarantees:

The main precondition is the coverage of the guarantee to be opened in your name, the coverage amount will be deposited in your special coverage account.
The scheme of your special coverage account, interest rate accrued on the account balance and other terms will be set in a relevant agreement.
In the event of partial availability or absence of your own funds, we will consider the issue of providing you with a line of credit.

Tariffs:

Bank Guarantees ^[1]
International trade guarantees
Guarantee issuance and approval (annual)		Based on a contract
Guarantee alteration (including extension)		0.15%, minimum AMD 50,000
Guarantee letter		0.15%, minimum AMD 50,000
Notification on alteration of guarantee terms and conditions		AMD 50,000
Payment under the guarantee issued and/or approved by the Bank		0.15%, minimum AMD 50,000
Guarantee revocation		AMD 50,000
Other Bank Guarantees^[2]
Currency	AMD or other currency
Maximum amount	For guarantees issued to legal entities and sole proprietors – up to AMD 5,000,000,000 or equivalent in another currency
Repayment period	For guarantees issued to legal entities and sole proprietors- up to 60 months
Chargeable amounts	For guarantees issued to legal entities and sole proprietors, if the chargeable interest amount for the actual or entire guarantee period does not exceed AMD 20,000, the principal must pay a lump-sum of AMD 20,000.
Modifications	AMD 15 000
Annual interest rate of liabilities secured by cash	1-3%
Annual interest rate if secured by other property	2-5%
Cancellation	AMD 25 000
Claim payment	0.5%, minimum amount - AMD 50,000
Issuance of international bank guarantees	0.15%, minimum amount – AMD 40,000

^[1]Apart from the set payments, the Bank will charge fees to cover its actual expenses.

^[2]The provisions and fees set forth herein refer to local guarantees.

Note: Apart from the chargeable amounts set by the bank's tariff rates, we will charge the amount of our actual costs.

For additional information and advice on issuance of guarantees, please turn to the bank's Head Office, Division of International and Exchange Operations.