2018 Surety Mid-Year Update: Growth, Capacity and Emerging Public/Private Connections

摘要

A favorable construction outlook,low loss severity numbers and plenty of surety capacity highlight the state of the industry thus far in 2018.Annual construction put-in-place continues to grow at a steady rate, with few down segments in the public sector despite funding uncertainty. While state and local governments struggle with limited budgets, these organizations are finding ways to move forward with increased taxes, user fees and alternative project-delivery mechanisms.Robert A. Murray, chief economist for Dodge Data & Analytics, recently noted, "In its latest quarterly survey of bank lending standards, the Federal Reserve indicated that lending standards for nonresidential building projects eased slightly on net during the first quarter of 2018, following the tightening that took place from late 2015 through 2017. In March, Congress reached agreement on fiscal 2018 appropriations, providing additional funding for severalpublic works programs. And, while interest rates are rising, the upward movement so far has been measured, with the 10-year Treasury bill stabilizing at about 3% from March through mid-May."