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F&M Bank issues two types of Letters of Credit to facilitate certain business transactions.
- Commercial (import) Letters of Credit - used most frequently in international trade for import transactions.
- Guarantees that the seller will receive payment if the buyer receives the merchandise as specified in the contract.
- Standby Letters of Credit - used most often in domestic transactions.
- Secures a customer's performance or financial obligation to another party.
- Standby Letters of Credit are not intended to be drawn on, except in the event that the applicant defaults under their obligations to the beneficiary.
F&M Bank advises and negotiates Export Letters of Credit and assists with understanding the terms of Letters of Credit.
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