Letters of credit (L/C) could help Donald Trump avoid or delay paying the US$540 million the former US president has been ordered to pay by courts in potential damages and fines resulting from his civil trials over the last year. If he fails to pay by 25 March, New York's attorney general says Trump could see his assets being seized.

Trump could however turn to surety companies offering supersedeas bonds - a type of surety bond that is often used during the appeals process in US legal cases - to keep him financially afloat while he appeals penalties imposed on him through the courts.

Cash alternative

Surety companies would normally require cash to guarantee the bonds would be repaid if Trump loses his appeals.

But should the former president be unable or unwilling to find sufficient cash, surety companies could be willing to accept irrevocable L/Cs from a bank to guarantee repayments.

Banking relationships

Banks providing the L/Cs would seek collateral and may, if cash is unavailable for this purpose, be prepared to take a charge on real estate or other assets.

But Trump's ability to obtain support from banks may be hampered poor relations with financial institutions in the past and he would most likely look for support from lenders he has used previously. If he does, details of the L/C amounts, conditions and terms may never be revealed.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.