Which of the following correctly states the role of banks in import\export transactions involving a letter of credit (L\C)?
A)The importer's bank is the advising and\or confirming bank;the exporter's bank is the issuing bank.
B)The exporter's bank is the advising and\or confirming bank;the importer's bank is the issuing bank.
C)The exporter's bank is the advising,confirming,and issuing bank.
D)The importer's bank is the advising,confirming,and issuing bank.
E)none of the above

Question

Quizplus · Accepted Answer

In international trade, the importer's bank acts as the issuing bank, which issues the letter of credit (L/C) to facilitate the transaction. The exporter's bank, on the other hand, serves as the advising and/or confirming bank. The advising bank communicates the terms of the L/C to the exporter, and if it also acts as the confirming bank, it adds its own guarantee to pay the exporter upon fulfillment of the terms, providing additional security to the transaction.

Which of the Following Correctly States the Role of Banks