Is irrevocable letter of credit and confirmed letter of credit synonymous?


An irrevocable letter of credit is not synonymous with a confirmed letter of credit. In an irrevocable letter of credit, the issuing bank may not, without the consent of the beneficiary and the applicant, revoke its undertaking under the letter, whereas, in a confirmed letter of credit, the correspondent bank gives an absolute assurance to the beneficiary that it will undertake the issuing bank’s obligation as its own according to the terms and condition of the credit. (Prudential Bank and Trust Company v. IAC, G.R. No. 74886, Dec. 8, 1992)