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Conditional Bank Guarantee
"I need a Conditional Bank Guarantee for SAR 5 million to secure a construction project in Riyadh, valid until March 15, 2025, with payment conditional upon certified evidence of contractor default and SAMA compliance requirements."
1. Details of the Parties: Identifies the Guarantor Bank, the Beneficiary, and the Principal (the party on whose behalf the guarantee is issued)
2. Background: Explains the underlying transaction or relationship necessitating the bank guarantee
3. Definitions: Defines key terms used throughout the guarantee document
4. Guarantee Amount: Specifies the maximum amount of the guarantee in both numbers and words
5. Purpose of Guarantee: Clearly states the specific purpose for which the guarantee is being issued
6. Conditions for Claim: Details the specific conditions that must be met for the guarantee to be called upon
7. Claim Process: Outlines the procedure for making a claim under the guarantee, including required documentation
8. Duration and Validity: Specifies the effective date and expiry date of the guarantee
9. Governing Law and Jurisdiction: Confirms Saudi law as governing law and specifies jurisdiction for disputes
10. Shariah Compliance: Confirms compliance with Islamic Shariah principles
11. Notice Requirements: Details how and where notices must be served between parties
12. Bank's Rights and Obligations: Outlines the specific rights and obligations of the issuing bank
1. Language Preference: Required when the guarantee is issued in multiple languages, specifying which version prevails
2. Counter-Guarantee Provisions: Needed when there is a counter-guarantee from another bank involved
3. Assignment Restrictions: Required when there are specific restrictions on assigning rights under the guarantee
4. Force Majeure: Optional clause defining circumstances beyond control that may affect the guarantee
5. Partial Claims: Required when partial claims under the guarantee are permitted
6. Anti-Money Laundering Compliance: Required for international guarantees or high-value transactions
7. Electronic Presentation: Required when electronic submission of claims is permitted
1. Schedule 1 - Form of Demand: Template for making a claim under the guarantee
2. Schedule 2 - Required Claim Documentation: List of documents required to be submitted with any claim
3. Schedule 3 - Authorized Signatories: List of persons authorized to make claims or give notices
4. Appendix A - Underlying Contract Reference: Details of the underlying contract or obligation being guaranteed
5. Appendix B - SAMA Compliance Checklist: Checklist ensuring compliance with all SAMA requirements
6. Appendix C - Supporting Documents: Copies of relevant supporting documents referenced in the guarantee
Authors
Banking and Financial Services
Construction and Infrastructure
International Trade
Manufacturing
Energy and Utilities
Real Estate Development
Government and Public Sector
Telecommunications
Defense Contracting
Transportation and Logistics
Legal
Finance
Treasury
Compliance
Risk Management
Commercial Operations
Project Management
Trade Finance
Corporate Banking
Credit Risk
Shariah Advisory
Chief Financial Officer
Treasury Manager
Finance Director
Legal Counsel
Compliance Officer
Risk Manager
Contract Manager
Project Director
Commercial Director
Banking Relationship Manager
Trade Finance Manager
Corporate Banking Officer
Shariah Compliance Officer
Credit Risk Officer
Senior Legal Advisor
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