UPDATE tt
SET
	tt.GuarantorKey = tg.MaxKey
FROM
	#tmpTest AS tt
	JOIN
		(SELECT ClientKey, MAX( GuarantorKey) AS MaxKey 
		FROM #tmpGuarantor 
		GROUP BY ClientKey
		) AS tg
	ON	tt.ClientKey = tg.ClientKey

SELECT * FROM #tmpTest

.........

create table #tmpGuarantor
(
ID int IDENTITY(1,1) PRIMARY KEY, 
clientkey int,
GuarantorKey int
)

...........

update t1 set t1.GuarantorKey = t2.GuarantorKey
from #tmpTest t1
INNER JOIN (SELECT clientkey, MAX(id) AS lastID 
		FROM #tmpGuarantor
		GROUP BY clientkey ) L ON L.clientkey = t1.ClientKey
inner join #tmpGuarantor t2 on t1.ClientKey = t2.clientkey AND t2.ID = L.lastID

.............