Hello everybody,
I need your kind advices. we sell to china and get LC 's issued by Chinese banks 'unconfirmed' .our activity field is textile raw materials. we are looking for banks who can add silent confirmation and discount without recourse, which means will act as a confirming bank. do you have any bank suggestions?
Question About Discounting Under Silent Confirmation
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odysseysunny
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bzaman
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Question about Discounting under silent confirmation
“Silent Confirmation” is not recognized under UCP DC-600 which shouldn’t be treated as “Confirmation” which is usually done by a bank at the request of an issuing bank which appears on Field 49 on a swift copy.
“Silent confirmation” is given by your bank(in this case a nominated bank) which is a commitment by that bank to their customer. This commitment has a similar effect to “Confirmation” and issuing bank is not aware of this fact. Providing a “silent confirmation” by a nominated bank(or advising bank) without recourse basis to their customer depends on the relationship between these two and the fact that how much trustworthy this customer is to the bank. Moreover credit rating/acceptability of the buyer (in this case your customer in China) is also a fact. My suggestion is that If you are looking for a bank to add “silent confirmation” – then talk to your bank whether they are willing to give you any prior assurance to “Negotiate” or “Honor” without recourse once the l/c is opened in your favor by your customer in China.
Others comments on this issue will be highly appreciable.
“Silent confirmation” is given by your bank(in this case a nominated bank) which is a commitment by that bank to their customer. This commitment has a similar effect to “Confirmation” and issuing bank is not aware of this fact. Providing a “silent confirmation” by a nominated bank(or advising bank) without recourse basis to their customer depends on the relationship between these two and the fact that how much trustworthy this customer is to the bank. Moreover credit rating/acceptability of the buyer (in this case your customer in China) is also a fact. My suggestion is that If you are looking for a bank to add “silent confirmation” – then talk to your bank whether they are willing to give you any prior assurance to “Negotiate” or “Honor” without recourse once the l/c is opened in your favor by your customer in China.
Others comments on this issue will be highly appreciable.