Jurisdiction(s):
Ireland

Ireland – Non-binding parent support comfort letter for a bilateral facility agreement: precedent with drafting guidance, enforceability and risk considerations

Published by a Lexis+ Ireland - Banking & Financial Services expert

Precedents

Comfort letter-non-binding

This specimen non-binding comfort letter is intended for use alongside a facility agreement, where the borrower’s parent company offers assurance to the lender in relation to the borrower’s financial commitments.

'letter of comfort'
'letter of responsibility'

The purpose of a non-binding comfort letter is to give the addressee confidence that the issuer will support the obligations of a third party (in this instance, the borrower). Its purpose is not to guarantee performance but to indicate the parent’s present intentions regarding support.

This template is drafted to avoid creating a legally enforceable duty for the provider; ie, it sets out a moral undertaking rather than a legal obligation.

Whether a comfort letter is binding depends on its precise wording, assessed against the relevant background and circumstances.

In most cases, a comfort letter contains only statements of intention or policy and, as such, carries no legal force. Accordingly, it operates as reassurance and guidance rather than a contractual commitment...

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Web page updated on 22/05/2026

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