undertaking against a deferred letter of credit

[berry]

dear all,

if a letter of credit is issued for a 120 days sight for which a complying presentation is made, the issuing bank has to incur a deferred payment under taking. to whom this under taking is given under the following circumstances -

1. The document is presented to a nominated bank
2. The document is presented to bank which is not nominated
3. The document which is presented directly to the issuing bank by the beneficiary

[iLC]

a presentation ideally comes with a settlement / payment instruction. the issuing bank should follow that. in general undertaking will the given to the person or bank that presents the document to a bank.

[cristiand969]

The undertaking is always toward beneficiary. However it is a practice that a bank to act on or on behalf the beneficiary and therefore the issuing bank would normaly undertake to the presenter.
brgds
Cristian