Is it possible to confirm a credit by more than one bank (Proportionately)? If yes, then how?

I opened a deferred credit through a bank in Switzerland (Bank X).The credit is available with (Bank X).The credit is issued subject to UCPURR Latest Version.

We request the advising bank to confirm the credit at beneficiary's cost but the advising bank advise the credit without adding its confirmation.

Probably the credit Line that is available with my bank and the advising bank which is also confirming bank exceed the Limit. However the applicant now requests us to confirm the credit with the help of some other banks proportionately. But I have no experience in this regard.

I will be obliged if you tell me the process of confirming a credit proportionately. I want to know the process.

Thanking You,

Zakir

The risk participation agreement must not be known by the issuing bank.

For the issuing bank, underLC, only bank X act as confirming bank.

The easiest way to have a large credit confirmed is for the Issuing Bank to request confirmation by one of its primary correspondent banks that it knows has lines of credit available in favor of the issuing bank.

To have a credit confirmed by a group of banks is more complex, but certainly possible. Two methods come immediately to mind and the first

is by far the easiest:

1. A bank can confirm the credit and sell off risk participations in the exposure to other banks.

OR

2. A group of banks can form a syndicate for the purpose of confirming the issuing bank's letter of credit. This is slightly more complex because it requires naming a "lead bank" who will handle the actual wording, and getting all member banks of the syndicate approved by the issuing bank, listing the amount of their individual risk on the face of the confirmation, and some accounting issues for each of the members of the syndicate.