Letters of Guarantee

A guarantee is usually issued by a guarantor (Doha Bank) in favour of the buyer (the importer) on behalf of the seller (the exporter). However, a guarantee can also be issued by the bank of the seller in favour of the buyer, as in the case of an advance payment guarantee. It is a guarantee that in the event that the exporter fails to complete their contractual duties, the guarantor will reimburse the buyer with a specified sum.

	Applicable Products	Description	Key Risks (Non-Exhaustive)
Bank Guarantees	Performance Guarantee	Issuance of all types of bank guarantees. Major types are mentioned on the left.	Doha Bank will honour valid claim under guarantees and SBLCS. Risk remains non-payment by Doha Bank client in the event of a claim
	Financial Guarantee	Issuance of all types of bank guarantees. Major types are mentioned on the left.	Doha Bank will honour valid claim under guarantees and SBLCS. Risk remains non-payment by Doha Bank client in the event of a claim
	Bid Bond Guarantee	Issuance of all types of bank guarantees. Major types are mentioned on the left.	Doha Bank will honour valid claim under guarantees and SBLCS. Risk remains non-payment by Doha Bank client in the event of a claim
	Advance Payment Guarantee	Issuance of all types of bank guarantees. Major types are mentioned on the left.	Doha Bank will honour valid claim under guarantees and SBLCS. Risk remains non-payment by Doha Bank client in the event of a claim
	Labour Guarantee	Issuance of all types of bank guarantees. Major types are mentioned on the left.	Doha Bank will honour valid claim under guarantees and SBLCS. Risk remains non-payment by Doha Bank client in the event of a claim
	Stand By Letters Of Credits (SBLCS)	Guarantees may be issued in the form of SBLCS as well.	Doha Bank will honour valid claim under guarantees and SBLCS. Risk remains non-payment by Doha Bank client in the event of a claim

Indicative Risk : NIL / MODERATE / HIGH / VERY HIGH

Performance Bond / Guarantee – a safeguard against the party to whom the commercial contract is awarded and it failing to meet an obligation under such a contract, which, by its nature, normally requires a period of time for completion.
Advance Payment Guarantee / Bond – a guarantee that advance payments will be returned if the party having received such payments does not perform the contract.
Bid / Tender Bond / Guarantee – provides an assurance of the intention of the party submitting a tender (i.e. The principal) to sign a contract if his tender is accepted.
Shipping Guarantee – a letter usually from an importer to the shipping company in which the importer undertakes to indemnify the shipping company against the consequences of delivering goods without the production of a bill of lading. The importers letter of undertaking usually requires the prior endorsement or guarantee by his bankers before it is acceptable to the shipping company who will then release the goods.
Tender Bond / Guarantee – a guarantee provided by a company responding to an international invitation to submit bid tenders. The tender bond is required to discourage frivolous bids and ensures that the winning bidder will execute the contact.
Stand by Letters of Credit – a form of guarantee such as demand guarantee. Used as security for a contingent event i.e. An importer failing to honor the exporters invoices under open account the importer claims against the standby letter of credit.

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Doha Bank’s retail, commercial and corporate products and services are granted at our sole discretion and are subject to the Bank’s terms, conditions and acceptance.