The Middle East Bank, aiming at mitigating risks of the parties of a transaction, expansion of and facilitating business activities and offering optimal level of customer service, offers types of internal and foreign currency guarantees in compliance with the regulations related to individual persons and legal entities.
The employers who put project implementation, procurement or supply (buy or sale) of goods out to tender/bid, in order to ensure fulfillment of obligations by the participants in the tender /bid, ask them to submit, together with their proposal, a guarantee (bond) in favor of employer. In case the winner of tender/bid fails to fulfil obligations (refusal to sign the contract, failure to carry out or procure the purchase or sale at the proposed price or failure to submit performance guarantee), the beneficiary of guarantee can invoke the same and the bank must cover and compensate losses.
In order to settle any claims made by the buyer/employer against supplier/contractor, regarding the failure of the latter on timely delivery (of goods) or carrying out of services, according to their contract, this type of guarantee is issued, according to the request of the customer (supplier/contractor), in favor of the buyer/employer.
Advance Payment Guarantee
In order to settle any claims made by the buyer/employer against supplier/contractor, regarding refund of the advance payments, in case the supplier/contractor defaults on doing his contractual obligations and proper delivery of goods or carrying out the work/services, the banks issue such guarantee if requested by the customer.
Retention Money Guarantee
In contract agreements and service provision contracts, a certain amount, as performance guarantee, is deducted, and withheld by the employer, from any progress payment made to the contractor. When the contractor is short of liquidity and requests to be paid according to the progress payments without any deduction, the employer, to secure against the contractor, asks for Retention Money Guarantee issued by a bank, in return of paying the amounts deducted as performance guarantee. The Middle East Bank offers such type of guarantee as well.
Based on this type of guarantee, the bank guarantees to cover obligations (settle debts) of an applicant for a certain transaction or work. If a debtor defaults on timely settlement of his debts, the beneficiary can receive the funds, as stipulated in the guarantee, from the bank.