Background

IBEC guarantees ensure Eastern European trade

The International Bank for Economic Co-operation is expanding interbank cooperation with the Bulgarian Municipal Bank AD by implementing the first trade finance deal aimed at supporting foreign trade between Bulgaria and Poland.

The guarantee issued by IBEC in the amount of EUR 2 million secured the fulfillment of the payment obligations of the Bulgarian buyer to the Polish supplier under the contract for the supply of railway rails. Thus, the Bank is expanding the possibilities for the implementation of trade contracts between companies from its member countries.

This transaction has an interesting legal structure. The IBEC Guarantee is issued in accordance with the international rules governing bank guarantees (ICC Uniform Rules for Demand Guarantees URDG 758), and, as requested by the supplier, is subject to Polish law. At the same time, the counter-guarantee of Municipal Bank AD is regulated by Bulgarian law. Thus, the wide IBEC product line for trade operations, unique experience of the Bank's professional legal expertise and the flexibility of the approaches allow taking into account the country specifics and interests of the participants, as well as offering the most convenient and efficient service. IBEC guarantees are recognized as a reliable instrument by an increasing number of European companies.

 

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