Loan guarantees are used by governments or financial institutions to support large investment transactions by reducing lenders' credit risk.
October 23, 2025
high
contextual
Loan guarantees can enable transactions that might otherwise be unaffordable or too risky for private lenders.
Countries can use U.S. dollar swap lines and loan guarantees to facilitate cross-border investments and to mitigate potential economic strain from large outbound investment commitments.
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financial
Swap lines and loan guarantees are tools used to provide liquidity and reduce sovereign financial risk when supporting large international transactions.