Unconfirmed Letter of Credit

(redirected from Unconfirmed Letters of Credit)

Unconfirmed Letter of Credit

A letter of credit which has not been guaranteed or confirmed by any bank other than the bank that opened it. The advising bank merely informs the beneficiary of the letter of credit terms and conditions.

Unconfirmed Letter of Credit

A letter of credit where only the bank issuing it has agreed to guarantee payment. This differs from a confirmed letter of credit, where at least two banks guarantee payment. This increases the risk for the bank that honors the letter of credit, as it only has one, rather than two, ways to seek recourse.
Mentioned in ?
References in periodicals archive ?
She added that Q-Panel Lab Products Corporation, a family-owned business in Cleveland, sold environmental test equipment to South Korea, Taiwan, Malaysia and Hong Kong using Ex-Im Bank's multi-buyer insurance policy to protect it against unconfirmed letters of credit.