Insolvency Outlook Deteriorates in NAFTA and Brazil, Atradius Survey Shows

Baltimore (ots/PRNewswire) -

- Rising insolvencies in the US (+3%) and Canada (+4) this year
- GDP contraction in Brazil (-3.4%) leads to rising bankruptcies
- 92% of businesses surveyed experienced late payment from their B2B
customers
- 2 in 5 businesses surveyed delayed payments to suppliers due to
customers' late payment

The 2016 insolvency outlook for NAFTA and Brazil has deteriorated
with increases of 3% and 4% forecast for the US and Canada
respectively. This increase is driven by low commodity prices. Low
oil prices, slowdown in economic growth in the US and slow
productivity growth in Mexico, and the recession in Brazil, are the
primary reasons for the forecasts of rising bankruptcies in these
countries. This challenging insolvency environment affects the way
businesses protect themselves against payment risk by B2B customers.

According to the latest edition of the Atradius Payment Practices
Barometer survey for the Americas (NAFTA and Brazil), 92% of the
businesses surveyed, experienced late payment from B2B customers over
the past year. This translated into an average of nearly half of the
total value of B2B invoices' being paid late. Due to late payment by
customers, 2 in 5 businesses had to delay payments to their own
suppliers causing a knock-on effect throughout the entire supply
chain. Essentially, a businesses' cash flow slows, restricting their
ability to invest and grow.

The September 2016 edition of the Atradius Payment Practices
Barometer survey sheds light on the payment behavior of domestic and
foreign B2B customers in the countries surveyed. It looks at local
trends in the use of credit management tools, at the perceived
challenges to profitability, at DSO, and at payment practices by
industry and business size.

Due to the financial distress caused by late payment by B2B
customers:

- around 30% of businesses had to take specific measures to correct
cash flow
- around 20% of businesses defaulted on payments to suppliers, and
had to pursue additional financing or lost revenues

To protect profitability of their business, 40% of the businesses
surveyed will request secured forms of payment from their B2B
customers and check both the creditworthiness and payment history of
their customers more often over the next 12 months.

Andreas Tesch, Chief Market Officer of Atradius N.V. comments,
"The outlook for insolvencies in the majority of the advanced
markets, including the US and Canada, has deteriorated. Regardless of
the underlying reasons for this, the challenges posed by a difficult
insolvency environment require that businesses resort to sound trade
receivables management strategies enabling them to grow safely."

David Huey, Regional Director of NAFTA adds, "The upward pressure
on insolvencies that the US and Canada are currently experiencing
makes their business environment more challenging, emphasizing the
importance of due diligence and protection against payment defaults."

The complete report highlighting the findings of the September
2016 edition of the Atradius Payment Practices Barometer for the
Americas (NAFTA and Brazil) can be found on the atradius.us
(https://group.atradius.com) website.

About Atradius

Atradius provides trade credit insurance, surety and collections
services worldwide through a strategic presence in 50 countries.
Atradius has access to credit information on 200 million companies
worldwide. Its credit insurance, bonding and collections products
help protect companies throughout the world from payment risks
associated with selling products and services on trade credit.
Atradius forms part of Grupo Catalana Occidente (GCO.MC), one of the
leading insurers in Spain and worldwide in credit insurance.

http://www.atradius.us

ots Originaltext: Atradius N.V.
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Contact:
Atradius Corporate Communications
Kathy Farley
Tel.: [phone]
E-mail: [e-mail]