Bonding
Guaranteed Solutions In Difficult Times
The economic outlook for 2013/14 continues to be one personified by uncertainty. Analysts broadly agree that the business environment in 2013 can only be approached with trepidation and caution.
T
here can be no complete list of hazards that lie ahead for organisations
of all sizes, and it is in such times that customers of Euler Hermes Bonding (specialising in Surety Bonds and Guarantees) are increasingly finding that the financial strength of the Euler Hermes Group allows solutions to be provided even in difficult circumstances. Only recently the Bonding team were approached via a key London Market International Broker for a major FTSE 250 firm. This firm had a guarantee requirement that was to be provided by their bank. The beneficiary of this particular guarantee however reviewed the financial standing of the well-known UK bank and concluded that they would prefer an alternative financial institution to provide the Guarantee. The broker chose to work with Euler Hermes Bonding to investigate if an innovative solution could be provided, avoiding the need for the client to seek an alternative
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banking solution. Within a very short lead time the Bonding Underwriting team, supported by the expertise of our in-house legal team, were able to deliver a solution, which not only met the customer’s requirements, but the financial strength of the surety from the Euler Hermes Group (S&P AA- rated) fully satisfied the beneficiary of the Guarantee. The question we are seeing many UK corporates now asking themselves is whether their businesses can be better served by non-bank solutions. At Euler Hermes, our Bonding Team are approachable and happy to discuss potential solutions, across various sectors, for bond and guarantee products that perhaps have traditionally been placed with banks.
One sector where Euler Hermes Bonding will always have a strong representation is the Construction sector, where bonds and guarantees are often a contractual requirement. This market is, of course not without its difficulties, and has been severely impacted by the global recessionary environment. However it is also widely recognised that construction, and in particular infrastructure projects, can provide a strong stimulus to growth. Upgrading assets, improving and renewing infrastructure has become a priority for the UK Government in its search for economic growth initiatives. Euler Hermes is part of Allianz and as a Group, Allianz is offering to invest in government sponsored projects to draw
together the complex elements required to bridge the funding gap for selected infrastructure projects. At Euler Hermes Bonding we will continue to support and seek new opportunities in the sector, on the basis that our clients meet key underwriting requirements, notably a relatively robust business model supported by strong character, capital and competence – the long established fundamentals of bond underwriting. Whatever your bond requirement our team based in our Queen Street office in the City of London would be more than happy to discuss options with you. Please feel free to contact us on 0207 332 7300 or by email at ehukbonding@eulerhermes. com.
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