N.Y. UCC Law § 5-118

Section 5--118. Security Interest of Issuer or Nominated Person.\n (a) An issuer or nominated person has a security interest in a\ndocument presented under a letter of credit and any identifiable\nproceeds of the collateral to the extent that the issuer or nominated\nperson honors or gives value for the presentation.\n (b) Subject to subsection (a), as long as and to the extent that an\nissuer or nominated person has not been reimbursed or has not otherwise\nrecovered the value given with respect to a security interest in a\ndocument under subsection (a), the security interest continues and is\nsubject to Article 9, but:\n (1) a security agreement is not necessary to make the security\n interest enforceable under Section 9--203(b)(3);\n (2) if the document is presented in a medium other than a written\n or other tangible medium, the security interest is perfected;\n and\n (3) if the document is presented in a written or other tangible\n medium and is not a certificated security, chattel paper, a\n document of title, an instrument, or a letter of credit, so\n long as the debtor does not have possession of the document,\n the security interest is perfected and has priority over a\n conflicting security interest in the document.\n