{"id":19241,"date":"2023-07-07T13:18:59","date_gmt":"2023-07-07T20:18:59","guid":{"rendered":"https:\/\/essential.construction\/news\/henry-collapse-drops-bomb-in-bonding-market\/"},"modified":"2023-07-07T13:19:00","modified_gmt":"2023-07-07T20:19:00","slug":"henry-collapse-drops-bomb-in-bonding-market","status":"publish","type":"post","link":"https:\/\/essential.construction\/news\/henry-collapse-drops-bomb-in-bonding-market\/","title":{"rendered":"Henry collapse drops bomb in bonding market"},"content":{"rendered":"<p> <a href=\"https:\/\/essential.construction\/files\/membership-default-internal\/\" class=\"memberhide\"><img decoding=\"async\" src=\"https:\/\/essential.construction\/news\/wp-content\/uploads\/sites\/15\/2023\/01\/20220718_175041000_iOS.jpg\" alt=\"-\"><\/a><br\/><br \/>\n<\/p>\n<div>\n<p>Some bond providers are warning firms will now find it much more difficult and costly to raise bonds as a result of the fallout.<\/p>\n<p>Surety capacity is being constrained as providers seek to manage risk, and brokers now warn that contractors with tight headroom on balance sheets could even be refused bonding.<\/p>\n<p>Henry Construction is believed to have had over \u00a3150m of bonds \u201clive\u201d at the time of entering administration, spread among 13 surety providers.<\/p>\n<p>The hit taken from the \u00a3400m revenue contractor\u2019s collapse is broadly equivalent to one year\u2019s premium throughput in the non-bank surety market.<\/p>\n<p>Chris Davies, managing director of broker DRS Bond Management, said: \u201cThe demise of Henry has bombed the market for probably a year to 18 months.<\/p>\n<p>\u201cIt was a once in 10-year event for a company of this size, but comes off the back of already high levels of corporate insolvency over the last 18 months.<\/p>\n<p>\u201cThe surety market has taken a big hit and now we are seeing bond capacity tightening appreciably. The next year or so is going to be difficult to say the least\u201d<\/p>\n<p>\u201d Everything will be scrutinised much more closely, particularly for bonds over \u00a31m or where expiry is beyond practical completion,\u201d he added.<\/p>\n<p>Bonding to net worth ratios, which determine the bonding ceiling for a contractor, have fallen from around 70% of the balance sheet worth, down to 40-50% per surety.<\/p>\n<p>Davies said that bonding over \u00a31m was now being spread across two or even three providers making it harder for contractors to secure.<\/p>\n<\/p><\/div>\n<p><script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-5143531171910809\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- News - Bottom -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-5143531171910809\"\r\n     data-ad-slot=\"8320848692\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script>\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><br \/>\n<br \/><a href=\"https:\/\/www.constructionenquirer.com\/2023\/07\/07\/henry-collapse-drops-bomb-in-bonding-market\/\" rel=\"nofollow noopener\" target=\"_blank\">This article was originally posted at Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Some bond providers are warning firms will now find it much more difficult and costly to raise bonds as a &#8230; <a title=\"Henry collapse drops bomb in bonding market\" class=\"read-more\" href=\"https:\/\/essential.construction\/news\/henry-collapse-drops-bomb-in-bonding-market\/\" aria-label=\"Read more about Henry collapse drops bomb in bonding market\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":19242,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1089],"tags":[],"class_list":["post-19241","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-construction-enquirer","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"_links":{"self":[{"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/posts\/19241","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/comments?post=19241"}],"version-history":[{"count":0,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/posts\/19241\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/media\/19242"}],"wp:attachment":[{"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/media?parent=19241"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/categories?post=19241"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/tags?post=19241"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}