Arranging a bank guarantee for a lease
Illustrative example — not a real client result
Understanding a landlord's proposed security requirement.
The challenge
A business taking premises is asked to provide a bank guarantee and needs to understand how it may be arranged.
The approach
- Review the amount, wording and timing required under the proposed lease with a solicitor.
- Discuss the lender's security, cash backing, fees and assessment requirements.
- Consider how the guarantee affects available cash or other facilities and how release is documented.
Example outcome
This example explains the matters to resolve before relying on a guarantee for a lease commitment.
A bank guarantee is a contingent obligation, not additional working capital, and may require security or cash backing.