Bank Guarantee (BG) is an irrevocable commitment by a Bank to pay an agreed sum to the beneficiary in the event that the party requesting to the Guarantee fails to perform its obligations or liability to the beneficiary.
At AFFINBANK we are also able to provide you with immediate BG issuance on adhoc basis against Cash Margin or Fixed Deposit as collateral.
BG constitutes a formal and trustable source of undertaking to both buyer and seller, besides BG also allows customer to ease their cash flow in replacement for deposit requirement.
Guarantees can be issued for various purposes. The main types are:
a. Tender / Bid Guarantee/Bond b. Performance Guarantee/Bond c. Advance Payment Guarantee d. Security Deposit Guarantee
This Guarantee/Bond is issued when you are going to bid for a tender of a contract and usually short term in nature.
Performance Guarantee/ Performance Bond is issued in relation to the performance of the contractor against their obligations /works under the contract. The BG amount is normally about 2.5% or 5% of the contract value and valid until the completion of the contract/work or until the expiry of the defect liability / warranty period.
Issued to cover the advances made by the beneficiary to the applicant in which if the applicant fails to perform the contract, such advances made earlier will be claimed upon.
Security Deposit Guarantee is used as a deposit by the applicant to cover payment such as to Tenaga Nasional, Telekom, and Customs and also for the supply of goods on credit term.
For more information, please call our Trade Finance Centre at: Kuala Lumpur: (6) 03 2178 5000 Ipoh : (6) 05 549 9959 Penang: (6) 04 398 8233 Johor: (6) 07 386 7597
Contact Centre 03-8230 2222
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