When a bank irrevocably guarantees a commercial paper issue,the bank's credit rating substitutes for the borrower's credit rating.

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When a bank provides an irrevocable guarantee for a commercial paper issue, the bank's credit rating is used as a substitute for the borrower's credit rating. This is because the bank agrees to take responsibility for repaying the debt if the borrower defaults. As a result, the creditworthiness of the bank is critical to investors evaluating the commercial paper issue.

When a Bank Irrevocably Guarantees a Commercial Paper Issue,the Bank's