Title 7, Chapter 1, Section 290
(a) Except as authorized in subsection (b) of this Code section, in paragraph (10) of Code Section 7-1-260, and in paragraph (4) of Code Section 7-1-261, a bank shall not lend its credit, bind itself as a surety to indemnify another, or otherwise become a guarantor.
(b) A bank may act as a surety or guarantor if it has a substantial
interest in the performance of the transaction involved or has a
segregated deposit sufficient in amount to cover the institution's
(c) Nothing in this Code section shall be construed to prohibit
(1) Giving warranties or guaranties in connection with the
handling of items for collection; the transfer, exchange, or
collection of securities; or the sale or disposition of its
(2) Issuing letters of credit; and
(3) Pledging or otherwise granting security interests in their
assets to secure public funds deposited in another bank.
(d) Notwithstanding other provisions of law to the contrary,
irrevocable letters of credit issued by banks domiciled in this
state may, in the discretion of the party in whose favor such
irrevocable letter of credit is issued, be accepted in lieu of any
bond, surety, or pledge of assets required by the laws of this state
or regulations promulgated pursuant to such laws.