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Finance/Loan Guarantee:
This guarantee is issued by the bank to cover borrowing requirements of a customer after
having been provided with
acceptable security. The bank will not be in a position to extend the facility due to
internal or external limitations.
Such guarantees will be issued only in unavoidable situations to potential customer. The
guarantee shall be limited to
amount and period.
Shipping Guarantee:
This type of guarantee is provided when the shipment under a letter of credit has
already
arrived at the port of
destination and the relevant documents has not yet arrived.
Advance payment and / or progress payment guarantees:
This is guarantee which gives protection to the buyer whom has made an advance or
progress
payment to the exporter
before the contract has been completed.
This guarantee is used to provide repayment of the advance or progress payment
should the
exporter fails to carry out
the contracted terms.
Requirements:
• He/ She should be a PBZ customer for at least six months
• A customer should provide:
- Business license
- TIN certificate
- Physical business location
- One recent passport size photos
- Certified copy of passport
- Certified copy of residency permit
• Audited financial statements for a period not less than two years
• Cash flow projections
• Title deed of fixed security
• Other information depending on the nature of the business.
For Limited Liability Company
• A customer should provide board resolutions
• CVs of directors
• IDs of directors
• Memorandum and Articles of associations
• Certified copy of Certificate of incorporation
For partnership enterprises:
• Partnership deed
• CVs of managing directors
• IDs of directors
• Certified copy of Certificate of registration
Benefits:
• Helps the business to finance short-term obligations
• An overdraft provides you with cash for unplanned expenses
• An overdraft will provide you with the comfort of knowing that you have
instant access to extra cash for emergencies
• You can use as much of your agreed overdraft limit as you need whenever you
need it. The total limit is
available to you for use.
A bond is sometimes known as surety. A bond is a guarantee issued by the bank to the
principal or employer guaranteeing
that the oblige (bank customer) will fulfil an obligation or series of obligations to the
employer and that in event
that obligations are not met, the employer will recover its losses via the bond issued by
the Bank.
Types Of Bonds:
Examples of bonds that are commonly used at the bank are:
Custom bonds:
These bonds are issued to enable the customer to obtain release of goods without
payment of customs duty.
Performance bonds:
These are the bonds containing an undertaking to pay a certain sum to the buyer
if the seller or contractor fails to
carry out the terms of the contract.
The purpose is to secure any claims by the buyer on seller arising from default
in delivery or performance of the terms
of the contract.
The period of these bonds will vary according to the terms of the related
contract.
Bid or Tender bonds:
It is an undertaking given by the seller of the goods or a supplier of services
to the buyer or purchaser.
Transactions for purchase of goods or procurement of services, the buyer or
purchaser calls for competitive quotations
(bid/tender) from potential suppliers.
The supplier is required to give a bond to the buyer / purchaser to supply the
goods or execute contract or service at a
certain price within a certain time and on the terms and conditions stipulated
by the buyer/ purchaser. Generally, the
buyer / purchaser require the supplier’s bank to join in such undertaking by
giving a bond.
The bank will consider among other things risks inherent tender/bid bonds such
as:
• Changes in the market
• Changes in price structures
• Inflation
• Additional costs
Tender bonds entail additional obligations e.g. the bank will be requested to
issue advance payment guarantee or
performance bonds.
Warranty bonds
These are the bonds issued by the Bank to the buyer to secure any claims by the
buyer on the seller due to possible
defects appearing after delivery..
Retention bond
Retention funds are funds held by the Bank on behalf of seller or contractor for
the fulfilment of the obligations to
the buyer. Retention funds shall be released to the seller or contractor upon
successful fulfilment of obligation to the
buyer or vice versa.
