Trade Finance provides:
- participation of the Bank (as the guarantor/lender) in commercial transactions;
- reduction of commercial and financial risks (in the period between delivery of goods and receipt of payment);
- reduced costs (compared with lending);
- optimization of financial flows.
Specialists of the Bank provide highly professional services and consultancies under various types of Guarantee and Letter of Credit transactions including those with financing.
- Letter of Credit (L/C) is a method of payment agreed upon between buyer and seller. The buyer’s bank (issuing bank) undertakes to make a payment to the beneficiary against receipt of documents complying with the terms and conditions of Letter of Credit.
- Upon Letter of Credit (L/C) issuance UniCredit Bank as the payer’s bank (issuing bank) undertakes an obligation to effect payment to the beneficiary/recipient of funds against presentation of documents confirming fulfilment of L/C terms.
- Along with import, UniCredit Bank effects L/C transactions under export contracts of customers as well as under domestic contracts payable in roubles.
- At present L/Cs are used as an appropriate alternative to advance payments and settlements based on an open account.
- Furthermore, the usage of L/C provides wide possibilities in respect of provision of financing by a Bank to its customers. For example, L/C issuance under documentary lines, arrangement of financing at the date of payment under L/C.
Letters of Credit:
For guarantees issuance and authenticity verification you can apply only to:
- Head office of AO UniCredit Bank: 119034, Moscow, Prechistenskaya emb., 9
or Saint-Petersburg Branch: 191025, Saint-Petersburg, emb. Fontanka River, .48/2;
- Contact email: TF@unicredit.ru;
- Moscow: (495)258-72-58; 258-73-40; 258-65-13;
- Saint-Petersburg: (812)346-84-10.
Any offers of assistance in obtaining guarantee of AO UniCredit Bank come from the Scam! We do not work with agents or intermediaries.
By means of the bank guarantee, the bank (the guarantor) assumes at the request of another person (the principal) a written obligation, to pay the principal’s partner (the beneficiary), on the latter’s written demand, a certain sum of money.
Bank guarantees are not the means of settlement and are used as security for the principal’s underlying obligation.
1. Guarantees issued by order of buyers
This guarantee ensures fulfillment of the buyer’s payment obligations as provided for in the contract. It is based on the terms of payment under the contract and covers the risk of default (or delay in payment) on the part of the buyer.
Sub-types of payment Guarantee:
- Loan repayment guarantee
- Guarantees in favour of the Authorities bodies of the Russian Federation (customs, tax and etc.)
2. Guarantees issued on the Seller’s Instructions
2.1. Bid Bond (Tender Bond)
The bid bond is a guarantee ensuring that participants in tenders fulfill their tender obligations to purchasers or contractors, namely that tender participants:
- shall not recall their bids within the bid validity;
- shall, having won the tender, sign a contract with the purchaser/contractor and provide the latter with appropriate performance security.
The amount of bond ranges from 1% to 5% оf the total value of the prospective contract.
2.2. Advance Payment Guarantee
This is a guarantee for the refund of an advance payment made under the terms of the contract in the event that the seller fails to deliver goods or perform works. The guarantee is normally enforced by crediting the advance to the seller’s account in the guarantor bank. The guarantee amount is decreased as the seller performs his contractual obligations covered by the advance.
2.3. Performance Bond (Performance Guarantee)
The performance bond is a guarantee securing the proper performance of the seller’s contractual obligations. It is usually up to 10% оf the total contractual value and may be decreased as obligations are performed. Such guarantee can also secure seller’s obligations within the warranty period, stated by the contract.
Stand-by Letter of Credit
The stand-by Letter of Credit is by nature an analogue of a guarantee. Payment under a stand-by Letter of Credit takes place only in case of default in performing underlying transaction.
It may be used only in cross-border deals (but not in domestic ones, on the Russian territory).
3. Guarantees in favour of the state bodies of the Russian Federation
The amount of the Bank limit for guarantees issuance is 8.5 bln RUR.
Guarantees in favour of tax authorities
UniCredit is an authorized guarantor by Ministry of Finance of the Russian Federation http://www.minfin.ru/ru/perfomance/tax_relations/policy/bankwarranty/
Guarantees in favour of Federal service for regulation of the alcohol market (Rosalcoholregulirovanie)
The amount of the Bank limit for guarantees issuance is 25.2 bln RUR.
Guarantees under Federal Law 44-FZ
UniCredit is an authorized guarantor by Ministry of Finance of the Russian Federation.
Cross-border Buyer’s Credit
It's a tied loan covered by international Export Credit Agencies (ECA) extended by UniCredit Group to Russian borrowers to finance their imports of capital intensive goods and services. Depending on the category of the imported goods, repayment tenor under such loans can reach 10 years. Size of the facility is limited to 85% of the contract value and could be increased subject to relating ECA approval for the amount of ECA premium (up to 100%) and for the local costs in the amount not exceeding 30% of the contract value.
In addition could be provide medium-term credit facility to finance advance payment of min 15% of the contract value.
Main advantages of the Buyer’s Credit are competitive pricing and long tenor of financing.
It's a tied loan provided by AO UniCredit to Russian borrowers to finance payment under import contract with international suppliers of capital intensive goods and services. Such credit facilities are funded by ECA-covered special tied financing provided by foreign financial institutions. Terms and conditions of such loan are similar to the conditions of Cross-border Buyer’s Credit.
Advantages of this product are long financing term and competitive pricing conditions. Additional benefit of such loan is a possibility for the borrower to stay within the domestic legal field.