Bank Guarantee (BG-i)

Bank Guarantee is a document issued by the Bank whereby the Bank undertakes to pay an agreed sum to the Beneficiary in the event that the Customer fails to honour the obligations in accordance with the terms and conditions of the Guarantee/Agreement/Contract (made under concept Kafalah Dhamanah)

The issuance of BG-i is subject to Malaysian Law of Contract. For foreign BG-i, it is subject to ISP 98, UCP 600 and URDG 758 whichever is applicable.

Types of Bank Guarantee

There are several types of guarantees issued by the bank depending on the needs of the customers.

The common ones are listed below:

  • Tender / Bid Guarantee
  • Performance / Contract Guarantee
  • Guarantee for advance payment
  • Guarantee in Lieu of Security Deposits / Supply Guarantee
  • Guarantee for exemption of Custom Duties
  • Guarantee of Maintaining Ledger Account
  • Guarantee for Honouring of Cheques
  • Custom Bond
Document Required

    The documents required for issuing Bank Guarantee are:

  • Letter of Indemnity For Non Surrender of Bill of Lading
  • Bank Guarantee Issue Request Form
  • Letter of Indemnity (BG)
  • Letter of Authorisation (where applicable)
  • Beneficiary supporting document (where applicable)
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