More than $500 million of the new bonds are backed by insurance or bank letters of credit.

Next week's Union Carbide issue is expected to be backed by a bank letter of credit.

To help those districts, the financing calls for one group of notes that are expected to be backed by a bank letter of credit.

For school districts with higher credit ratings, a separate issue of notes might be sold without any special bank letter of credit.

In the Merrill program, which aims at a profit of 20 basis points, the county will sell commercial paper backed by a bank letter of credit.

Corporations can guarantee debt with bank letters of credit, thus avoiding the costly, time-consuming process and rigid disclosure standards of registering debt.

After all, he noted, the bank letters of credit on which many small importers depend place a large amount of control in the hands of the issuing lenders.

Mr. Harfield negotiated and prepared the Canadian bank letters of credit that guaranteed provision of the medical supplies that led to the prisoner release.

The most likely form would be a bank letter of credit, which would cost the county up to two percentage points more in financing costs than the MBIA insurance.

Initial funding to establish operations came from a $65 million bank letter of credit, guaranteed by several of the then members, and was repaid following the issuance of bonds.

The state will also be seeking a bank letter of credit to back part of the proposed $4 billion note sale, which will be managed by Lehman Brothers as well.

The board opted for the Goldman financing although it still had six months to repay the Mitsubishi Bank letter of credit and there were two other refinancing offers on the table.

Despite the fact that tax-exempt bonds are available for the permanent financing, a bank letter of credit must be obtained by builders to guarantee the bondholders against the risks in the construction process itself.

The next city bond sale is a $950 million financing planned for October, with proceeds to be used for defeasing outstanding bonds that are backed by insurance companies or commercial bank letters of credit.

Mary Peloquin-Dodd, a director at S.& P., said there was also a large and growing number of these bonds issued with some kind of outside credit enhancement, like bond insurance or a bank letter of credit.

Questions about bond insurance and other credit guarantees such as bank letters of credit came to light recently in some bond financings in Washington County, Pa., where a law firm stated that its earlier opinion might not be valid.

The old government, however, required companies to provide separate bank letters of credit for the kickbacks, "to guarantee that they will pay them later to Iraq," as the country's irrigation minister noted in a Sept. 9, 2000, letter to Mr. Ramadan.

Through such a defeasance, a process by which payment of interest and principal will come from a pool of Treasury securities rather than from the city, New York will be able to issue more bonds backed by insurance companies or bank letters of credit.

Other alternatives to retainage are to allow the contractor to supply substitute security to the owner in the form of a performance bond, bank letter of credit, or a security of, or guaranteed by, the United States, such as bills, certificates, notes or bonds.

A default would have eliminated the REIT's biggest source of income by far, so the REIT's investment bankers at Paine Webber began scrambling to find financing to repay the Mitsubishi Bank letter of credit when it expired in June, 1995.