Performance Bonds

Performance Bonds are established by contractors for the benefit of their clients or potential clients that provides security against default or non-performance and are an alternative to bank guarantees.

They provide third party financial protection, generally without encumbering assets or established credit lines and include:

  • Bid Bonds
  • Performance Bonds
  • Advance Payment Bonds
  • Retention Release Bonds
  • Maintenance Bonds
  • Off-Site Material Bonds

The guidelines for eligibility are:

  • Minimum company turnover of $30 million per annum and;
  • Balance Sheet Net Tangible Assets of at least $4 million dollars.
  • Dollar for dollar cover in terms of net tangible worth versus bond facility size. i.e. Details of the ownership structure and financials for the company group/trusts involved with the applicant.
  • Owner/Shareholder guarantees are mandatory with facilities for privately owned entities of this size and nature.
  • Positive cash flow, working capital and retention of profits within the business.

Performance Bonds can offer significant assistance to companies looking to undertake major developments.