Credit guarantees are an important risk management tool for citizens.
As a rule, entrepreneurs, legal entities and representatives of companies act as clients of the bank.
The essence in this case is simple: credit guarantees are provided to the customer of goods or services that are purchased from their supplier.
At the same time, the bank issues a guarantee that the customer will fulfill its obligations to the supplier, that is, it will pay the debt even if the customer fails to pay the amount.
How the one who initiated the transaction (the recipient of the goods) will pay the bank - there are a lot of options.
Perhaps he will pay the debt in a lump sum after a certain period of time, but perhaps he will be given the opportunity to either divide the balance of the debt into several payments. In this case, the guarantor bank will issue funds to the supplier immediately.
A similar approach is relevant for individuals. At the same time, such services can be provided not only by banks, but also Insurance companies and some other organizations.
However, an appropriate license must be issued to provide warranty services.
There is also a myth that the guarantor - the bank, has the right to refuse obligations.
In fact, this will not happen, because if the bank has taken obligations, in unilaterally it is impossible to cancel them.
Termination of credit guarantees
The guarantee ceases to be valid at the moment when the bank transfers funds to the creditor - the supplier of services or goods.
From now on, in case of registration bank loan the buyer of goods (services) begins to pay a full-fledged loan, which is closed after the full repayment of the debt.
Participants in relations with a bank guarantee are the guarantor bank, the principal and the beneficiary.Guarantor bank- the bank issuing the guarantee, i.e. who undertakes, upon the occurrence of the circumstances specified in the guarantee, to make payment to the person indicated in it. In addition to banks, insurance companies can issue guarantees.
Principal- this is the person at whose request a bank guarantee is presented (for the principal debt, this is the debtor, the borrower).
Beneficiary- a person, at the request and in favor of which the guarantor bank makes a payment (for the principal debt - the creditor).
In practice, the term "guarantee" is often used as a synonym for surety. Common to them are the obligations of both the guarantor and the guarantor to pay a sum of money in the event of default by the debtor. The participants in the relationship are the same. The features of these concepts are manifested in the legal field.
bank guarantee- this is a one-sided transaction, since when it is concluded, the will of only one party (the guarantor) is sufficient. A bank guarantee is independent of the legal relationship between the beneficiary of the guarantee and his debtor (principal).
Thus, a bank guarantee is a written obligation of the guarantor to pay, at the request of the beneficiary, the amount Money in accordance with the terms of said obligation. That is, the guarantor bank gives, at the request of the principal, on its own behalf, a written obligation to pay the principal's creditor (beneficiary) a sum of money in accordance with the terms of the guarantee.
The bank guarantee must contain information that allows the beneficiary to verify the following:
1) that the guarantee is issued by an entity entitled to do so, which must be indicated in its license;
2) that the person who signs the document is authorized to do so.
In this regard, the beneficiary must either familiarize himself with the license of the guarantor, or a notarized copy of the license is submitted along with the guarantee.
Bank guarantees are popular among both bank customers and banks themselves. This happens for a number of reasons: firstly, guarantees have high reliability and secondly, they are rapidly realizable. For a bank, this is a type of activity that generates income (it charges a commission for the provision of these services) and does not require immediate withdrawal of funds from circulation (unlike, say, from credit operations). That is, in this case, the diversion of funds either does not occur at all, or it is delayed in time.
Russian banks, whether regional or credit organizations, the practice of issuing guarantees, as a rule, against security has developed. In relation to stable clients, an agreement can be used as collateral, giving the bank the right to write off the necessary amounts from the client's accounts without acceptance to reimburse the costs incurred by the guarantor. Other clients usually provide collateral as security securities, draw up a pledge of goods material assets etc.
The characteristics of a normal bank guarantee are urgency and irrevocable, which means that the guarantor is not entitled to unilaterally, i.e. without the consent of the beneficiary, to refuse the obligations assumed. Revocable guarantees are extremely rare, as they do not correspond to the nature of a bank guarantee and cause mistrust on the part of the beneficiaries.
There are guarantees secured and unsecured. A secured guarantee involves the presence of a pledge of property or other means of security, while an unsecured guarantee is a simple written obligation of the bank.
Confirmed a bank guarantee is a guarantee confirmed in full or in part by another bank, which is jointly and severally liable to the beneficiary.
Syndicated(consortial) bank guarantee - a guarantee, which can be issued by several banks acting through the main guarantor bank. Such guarantees are used in large (including international) transactions, and the more banks are involved in issuing a guarantee, the more expensive this service is.
Guarantees are also divided into straight and counter-guarantees. In the first case, the guarantor bank itself assumes the obligation to the beneficiary. A counter-guarantee is issued if the bank, on behalf of the principal, requires the issuance of a guarantee from another bank (including a foreign one) by issuing a counter obligation.
Credit guarantee
CREDIT GUARANTEE
Finance. Dictionary. 2nd ed. - M.: "INFRA-M", Publishing house "Ves Mir". Brian Butler, Brian Johnson, Graham Sidwell, etc. General edition: Doctor of Economics Osadchaya I.M.. 2000 .
Credit guarantee
A credit guarantee is a form of insurance against losses arising from debts that are not likely to be repaid.
See also: secured loans
Finam Financial Dictionary.
- (credit guarantee) See: credit insurance; insurance against non-payment of debts (credit insurance). Business. Dictionary. Moscow: INFRA M, Ves Mir Publishing House. Graham Bets, Barry Brindley, S. Williams et al. Osadchaya I.M..… … Glossary of business terms
- (from French garantie guarantee, guarantee) according to Dahl's dictionary “guarantee, surety, bail, security, pledge, answer (with answer), assurance, safety, security, security, fear. Guarantee that, ensure, vouch, ... ... Wikipedia
Guarantee- (Warranty) Quality and service guarantees The essence of the guarantee, product guarantee and money back Contents Contents Section 1. as a way to secure obligations. Section 2. Types of warranties. A guarantee is to guarantee something, to provide, ... ... Encyclopedia of the investor
- (French garantie, from garantir to provide, protect) in civil law an obligation stipulated by law or contract, by virtue of which a person (natural or legal) is liable to creditors in whole or in part ... Great Soviet Encyclopedia
Tender Guarantee- - a written guarantee issued by the bank for the tender participant. Wherein financial institution guarantees that such a participant will fulfill its obligations in accordance with the rules of the competition. Tender Guarantee covers... ... Banking Encyclopedia
bank guarantee- (English bank guarantee) in the civil law of the Russian Federation is one of the ways to ensure the fulfillment of obligations. In accordance with Art. 368 of the Civil Code of the Russian Federation * by virtue of B.g. a bank, other credit or insurance organization (guarantor) is given at the request of another person (principal) ... ... Encyclopedia of Law
bank guarantee- one of the ways to ensure obligations. According to the civil legislation of the Russian Federation, by virtue of B.g. a bank, other credit institution or an insurance organization (guarantor) give, at the request of another person (principal), a written obligation to pay the creditor ... ... Big Law Dictionary
Credit documentation- the agreement (or agreements) on the basis of which the financing is carried out innovative project(loan agreement, agreement on opening a non-revolving credit line, general agreement on opening a credit line, etc.), and documents ... Dictionary " Innovation activity". Terms of innovation management and related fields
Credit- (Credit) A loan is a transaction for the transfer of material assets to a loan. The concept of a loan, types of loans, registration, conditions and issuance of a loan Contents >>>>>>>>>>>> ... Encyclopedia of the investor
Seven loan programs for small businesses of Uralsib Bank- In June 2010, Uralsib Bank launched a new credit line of seven products for small businesses. It is worth paying attention to the fact that the bank is ready to finance enterprises that have existed for at least six months. Usually… … Banking Encyclopedia
The selection of legal entities that will be provided with state guarantees for the loans they attract will be carried out until October 31, 2015 (Decree of the Government of the Russian Federation of March 24, 2015 N 266).
Decree of the Government of the Russian Federation of August 14, 2012 N 825 approved the Rules for the provision of state guarantees in 2012 - 2014 Russian Federation on loans or bonded loans attracted by legal entities for the purposes, established by the Government within the framework of measures aimed at increasing the resilience economic development when the situation worsens financial markets. By the Decree signed, the said Rules were extended for 2015.
The rules for granting in 2012 - 2015 state guarantees for loans or bonded loans raised by legal entities for the purposes established by the Government of the Russian Federation as part of measures to increase the sustainability of economic development in the event of a deterioration in the situation in the financial markets, were approved by Decree of the Government of the Russian Federation of August 14, 2012 N 825. The rules provide preferential procedure for selecting principals and the possibility of providing state guarantees for the refinancing of previously attracted loans.
- Warranty period from 3 to 7 years
- Guarantees are provided to secure the fulfillment of the obligations of the following Russian legal entities (hereinafter referred to as the "principals"):
a) strategic organizations of the military-industrial complex included in the list of strategic enterprises and strategic joint-stock companies, approved by Decree of the President of the Russian Federation of August 4, 2004 N 1009, and (or) in the list of strategic organizations, as well as federal bodies executive power, ensuring the implementation of a unified public policy in the sectors of the economy in which these organizations operate, approved by Decree of the Government of the Russian Federation of August 20, 2009 N 1226-r, subject to the inclusion of these organizations in the consolidated register of organizations of the military-industrial complex in accordance with the Decree of the Government of the Russian Federation of February 20 2004 N 96, and are the executors of the state defense order, for the return of the loan amount (for the payment of the nominal value of bonds upon their redemption), in the amount of up to 70 percent of the named obligations;
b) other organizations, not specified in subparagraph "a" of this paragraph, for the return of the loan amount (for payment of the nominal value of bonds upon their redemption) in the amount of up to 50 percent of the named obligations.
- The guarantee is provided without charging the guarantor's remuneration.
- The warranty is provided subject to the following conditions:
a) the principal has no overdue (unsettled) debt on monetary obligations to the Russian Federation, as well as on mandatory payments to the budgets of the budgetary system of the Russian Federation;
b) acceptance by the principal of obligations to reduce the amount of remuneration (bonuses, bonuses and other incentive payments) of the management team (members of the board of directors (supervisory board), members of the collegial executive body, the sole executive body and his deputies, the chief accountant (other official of the principal, on which is entrusted with accounting), heads of independent structural subdivisions) of the principal for the period of provision of state guarantee support in accordance with these Rules;
c) satisfactory financial condition of the principal.
- The guarantee shall not be provided to secure the fulfillment of the obligations of a principal who is in the process of reorganization or liquidation, as well as against whom insolvency (bankruptcy) proceedings have been initiated.
- The decision on the selection of principals is made on the condition that:
a) ensure that the principals are transparent about their financial and economic activity and ownership structures;
b) fulfillment by the principals of the obligations of the employer upon dismissal of employees, as well as the preservation of jobs for the disabled and other socially vulnerable categories of employees;
c) representation by creditors in government commission, an interdepartmental commission confirming the analysis financial condition principals and acceptance credit committees creditors of decisions on granting loans based on the business plans submitted by the principals;
d) submission by the principals to the Government Commission, the interdepartmental commission of information on the availability of other (other than guarantees) security for the performance of the principals' obligations under loans (bond loans) (indicating the name, amount and term of security).
The composition and volume of other, except for guarantees, security for the performance of obligations of principals under bonded loans are determined by the principals, and for loans - by the principals in agreement with the creditors.
- The decision to issue a guarantee is made by the Ministry of Finance of the Russian Federation.
Features of the provision and execution of a guarantee to secure the fulfillment of the principal's obligations under the loan:
- The loan guarantee is provided to secure the fulfillment of obligations:
a) the principal specified in subparagraph "a" of paragraph 2 of these Rules, on a loan attracted by the principal in the currency of the Russian Federation for a period of 3 to 7 years, on the return of the loan amount (repayment of the principal debt) within the established loan agreement term in the part constituting up to 70 percent of the amount of credit (principal debt) actually provided to the principal;
b) the principal specified in subparagraph "b" of paragraph 2 of these Rules, on a loan attracted by the principal in the currency of the Russian Federation for a period of 3 to 7 years , on the return of the loan amount (repayment of the principal debt) within the period established by the loan agreement in part, up to 50 percent of the amount of credit (principal debt) actually provided to the principal.
In 2015, the guarantee is provided to secure the fulfillment of the principal's obligations to repay the loan amount (principal debt), the due date for which, in accordance with the terms of the loan agreement, comes after January 1, 2018.
The guarantee is not provided to secure the fulfillment of other obligations of the principal under the loan (loan agreement), including obligations to repay the loan amount (repayment of the principal debt), the deadlines for which, in accordance with the terms of the loan agreement, come before January 1, 2015 - for guarantees, issued in 2012, earlier than January 1, 2016 - for guarantees issued in 2013, earlier than January 1, 2017 - for guarantees issued in 2014, earlier than January 1, 2018 - for guarantees issued in 2015, on the payment of interest for the use of a loan, other interest, commissions, penalties (fines, penalties), on the early fulfillment of the principal's obligations to repay the loan amount (repayment of the principal debt), including in the event that the principal is presented with requirements for their early fulfillment or the occurrence of events, by virtue of which the deadline for fulfilling obligations under the loan agreement is considered to have come, as well as the principal’s liability for non-fulfilled non-performance or improper performance of obligations under the loan agreement and causing losses.
Guarantees are provided for loans from Russian banks holding a general license Central Bank Russian Federation for implementation banking operations, as well as on loans from the state corporation "Bank for Development and Foreign Economic Affairs (Vnesheconombank)" (hereinafter referred to as creditors).
The period of validity of guarantees provided in 2012-2014 is determined on the basis of the deadline for fulfillment of obligations secured by the guarantee, established by the terms of the loan agreement, increased by 70 calendar days. The period of validity of the guarantee provided in 2015 is determined on the basis of the deadline for fulfilling the obligations secured by the guarantee, established by the loan agreement, increased by 90 calendar days.
By definition, a bank loan product is a specific service for lending to individuals and companies. Credit products differ in their quality (terms of provision) and quantity (amount). Different banks offer different loan products, this is a kind of "goods" that the bank sells.
A guarantee is one of the types of “commodities” that a bank trades in order to earn money. At its core, this is a loan that the bank issues to the principal for a one-time fee. Despite the fact that the bank does not issue a sum of money to the principal, it provides him with an obligation to pay a certain amount of money to a third party upon the occurrence of certain events.
The bank's approach to considering an application for a guarantee is similar to that used for lending. On the one hand, a bank guarantee is a loan provided legal entities, and on the other hand, it refers to documentary operations.
When issuing a loan, the bank is always interested in its return, as well as in receiving interest from the borrower for the use of borrowed funds. When issuing a paid guarantee, the bank is interested in the principal fulfilling his obligations without outside participation. If the bank makes payments under the guarantee, it recovers the amounts paid from the principal. The attractiveness of bank guarantees compared to loans is that they are much cheaper than loans. This makes them popular and ubiquitous in business operations.
The list of documents for obtaining a guarantee is approximately the same as for applying for a loan. A sign that a bank guarantee is a special type of lending is the requirement for collateral when it is issued. Banks accept as collateral for guarantees:
Of great importance is the liquidity of the property offered as collateral. The bank must be sure that in case of non-repayment of the amount paid under the guarantee, it will be able to sell the debtor's property and reimburse the principal's debt. The more liquid the property pledged, the more profitable terms a bank guarantee will be offered by a credit institution.
A bank letter of guarantee is one of the most popular ways to secure financial obligations and instruments of financial influence.
Covered bank guarantees are most beneficial for banks, as they are provided under financial security with a minimum risk of non-repayment of funds spent by the bank in the performance of guarantee obligations. For companies, such guarantees are a quick tool when concluding government contracts, diverting working capital for the period of fulfillment of contractual obligations.
Promissory notes (promissory notes) of banks or other companies can be pledged upon receipt of bank guarantees. Bank bills have high liquidity and are readily accepted by guarantors. Companies can issue avalized bills against payment obligations of other banks.
