Stening Simpson Group, one of the largest managers of Surety Bond and Financial Guarantee programmes in Australia, said today that more businesses across Australia are freeing up much-needed capital by switching to surety bonds from bank guarantees.
“The credit crisis is forcing companies to come up with alternative capital strategies, ensuring their banking lines remain as open as possible”, said Peter Stening.
Bank guarantees use up a company’s banking facility. Surety bonds offer a cost effective alternative to bank guarantees, with the added advantage of banking facilities remaining unchanged. In an environment where protection and access to capital is so crucial, surety bonds offer a solution.
“Surety Bonds have the backing of well-capitalised specialist underwriters, are a widely accepted form of Contract Security, afford clients a high level of financial protection and are available to all industries that are required to provide security for contracts. They provide an additional unsecured source of finance and enhance working capital and liquidity”, said Mr. Stening
Stening Simpson has seen increased interest in surety bonds, which is no surprise, given the need for companies to establish capital strategies which ensure their banking lines remain unchanged in the current climate.