Friday, 29 December 2017


CHAPTER 18 - PARTIES IN BANK TO BANK REIMBURSEMENTS

Reimbursing Bank

·         A bank which is given a Reimbursement Authorization by the Issuing Bank in the LC.

·         The Reimbursing bank is the bank that, at the Instruction of the issuing bank, is authorized to Honour the payment when the Negotiating or Confirming bank Claims for the value of documents negotiated or presented by them.

·         An issuing bank is not relieved of any of its obligations to provide reimbursement if reimbursement is not made by a reimbursing bank to the Negotiating bank or Confirming .Bank on first demand.

·         It is normally the bank where the issuing bank is maintaining their foreign currency nostro account.

Claiming Bank:

·         As per the Issuing Bank’s Instruction on Reimbursement mentioned in the LC, the Negotiating Bank or Confirming Bank Claims the money from Reimbursing Bank, so from Reimbursing Bank’s view the bank which claims the Payment will be seen as Claiming Bank. 

·         "Claiming bank" is a bank which is authorized to present a reimbursement claim to the reimbursing bank.

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