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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

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.

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