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This paper intends to study the international standard banking practice of letter of credit between Korea and China. Generally speaking, there are no major differences in both countries. But there are minor differences in both countries due to the difference of law and practices, legal system and banking practices of Korea and China. First, there are some differences in the international standard banking practice of letter of credit in China due to the difference of practices under Bills of Exchange Act and the Provisions of the Supreme Peoples’s Court on Some Issues Concerning the Trial Cases of Disputes over Letter of Credit. The Act insists on the consistency between the amount written in words and a figure amount. The Provisions include the recognition of revocable credits, the difference of standard in examining documents. Second, there are some differences in the legal systems and compliance with international standard in both countries. Judges in China tend to abuse the injunctions owing to the lack of understanding in relation to letters of credit. On the other hand, Korean judges rarely allow an injunction in cases of asserted fraud. Third, there are some differences in the standard banking practices of letter of credit in both countries. Korean nominated banks act positively, but Chinese nominated banks act passively. There are more soft clauses in the letters of credit of China than in Korea.
