Bank Guarantee

As the practice shows even the perfectly drawn agreement cannot protect you from failure to implement the undertaken liabilities by the counteragents. How the financial interests of the parties participating into the civil legal deals might be protected? The Bank guarantee of JSC Bank VTB (Georgia) is the way to do so.


What is the Bank guarantee?

Bank guarantee is the irrevocable obligation of a bank to pay a sum of money in the event of nonperformance of the obligations of third party. Bank guarantee is the independent liability and according to its conditions, the Bank has to pay on first demand provided that the conditions contained in the guarantee are fulfilled.

Bank guarantee is irrevocable — it might not be revoked if there is not foreseen anything other.

While issuing the guarantee Bank checks the goodwill of the client with the due diligence, thus, the Bank guarantee confirms the financial stability of the company as well as its ability to implement the liabilities undertaken according to the contract.

JSC Bank VTB (Georgia) issues the Bank guarantees of all types, local and international, in favor of Beneficiaries located in various countries of the world, and also implements authentication and advising of the guarantees issued by other banks.

The major types of guarantees:

  • Performance Bond
    With the performance bond the Bank undertakes, at the request of principal, to pay to the beneficiary (buyer or ordering party) the guaranteed amount in the event the applicant has not met or insufficiently fulfilled his contractual obligations.

  • Advance payment guarantee
    With advance payment guarantee Bank undertakes to repay the advance in the event of nonperformance of contractual obligations bythe principal.

  • Tender Guarantee (Bid Bond)
    Bank undertakes to pay to the beneficiary in case principal fails to sign the contract and execute tender requirements.

  • Payment guarantee in case of non-payment
    With the payment guarantee the Bank undertakes, at the request of the principal, to pay to the beneficiary (buyer or ordering party) the guaranteed amount in the event the applicant has not met or insufficiently fulfilled his payment obligations.

  • Customs guarantees
    Such guarantees are aimed for submitting to customs authorities, to secure principals obligations related to customs clearance of goods.

  • Warranty guarantee
    Such guarantees are issued to secure principals obligations related to warranty of goods delivered/services rendered.

  • The guarantee issued in favor of the Executive Bureau
    This type Bank guarantee provides participation into the auctions held for purchase of the real estate and the moveable assets.
    Etc.

Local Guarantee  
Issuing fee    
Amount Cash Backed Secured by other assets
Up to GEL 500 GEL 75+GEL 11 (for el. guarantees)
GEL 75+GEL 11 (for el. guarantees)
GEL 500 - 5,000 (or other currency) up to 3 months - 100 units
3 - 6 months - 130 units
6 months and more - 200 units
up to 3 months - 130 units
3 - 6 months - 200 units
6 months and more - 260 units
GEL 5,000 - 10,000 (or other currency) up to 3 months - 150 units
3 - 6 months - 200 units
6 months and more - 300 units
up to 3 months - 200 units
3 - 6 months - 300 units
6 months and more - 400 units
GEL 10,000 - 15,000 (or other currency) up to 3 months - 200 units
3 - 6 months - 250 units
6 months and more - 350 units
up to 3 months - 250 units
3 - 6 months - 350 units
6 months and more - 500 units
% for annual service Issuing fee 0.5% (min. GEL 100) + from 1.5% per annum Issuing fee 0.5% (min. GEL 100) + from 1.5% per annum
Payment of guarantee 0.15% min. 50 - max. 450 units 0.15% min. 50 - max. 450 units
Entering changes to guarantee / advising changes 50 units 50 units
Guarantee early cancellation fee 50 units 50units
Guarantee advising 0.15% min. 50 - max. 400 units 0.15% min. 50 - max. 400 units
Other expenses According to the fact According to the fact
International guarantee  
Issuing fee Issuing fee from 0.1% (min. USD 100), interest rate according to the fact Issuing fee from 0.1% (min. USD 100), interest rate according to the fact
Interest rate

Actual expenditure + % negotiated with the Bank


Actual expenditure + % negotiated with the Bank

Guarantee early cancellation fee
Guarantee advising
Other expenses