Confirmed letter of credit
A letter of credit that contains a guarantee on the part of both the issuing and de advising banks of payment to the seller so long as the seller´s documentation is in order and the terms of the letter of credit are met. Confirmation is only added to irrevocable letters of credit, usually available with the advising bank. If confirmation of the letter of credit is desired, the applicant must state this expressly in his/her letter of credit application. The confirming bank assumes the credit risk of the issuing bank as well as the political and transfer risks of the purchaser´s country. Without confirmation of the letter of credit, the advising bank will forward the letter of credit to the beneficiary without taking on its own commitment. See letter of credit. Model of Letter of Credit.