IntaCapital Swiss, is a market leader in Collateral Transfer and Collateral Transfer Agreements, where one company, designated the Beneficiary, can lease a Bank Guarantee, from another company, designated the Provider.

For more information on the Provider, please see “Who Are Providers And What Are Their Benefits From Leasing Bank Guarantees”.

A Collateral Transfer Agreement is a renewable contract, especially if the contract is for two or more years, going up to and including seven years. The contract/agreement will renew automatically subject to the Terms and Conditions contained within the agreement. However, if as usual, the agreement is for one year, and the Beneficiary decides they need to rollover the Bank Guarantee into the second year, they must inform IntaCapital Swiss no later than one month before the end of the contract, so they may obtain the necessary permissions from the Provider and the Lender.

As with all Collateral Transfer Agreements, there are various cost and fees that are for the account of the Beneficiary. The two most expensive costs are the Provider’s fees, and the cost of borrowing for one year. Other fees include arrangement fees, due diligence fees, booking and legal fees. However, in year two and on up to year seven, the Beneficiary will only be liable for the cost of one year’s borrowing and the Provider’s fees.

Fees tend to stay fairly static unless there are wild movements in the world’s money markets. It is expected that the Provider’s will remain fairly stable, however, movements in the money markets can affect the one-year Libor and one-year Euribor rates. In the event the Beneficiary is faced with an increase in the interest rate, the cost is for their account.