Bankability is determined on a case-by-case basis as each project is different, but there are certain benchmarks that generally need to be satisfied for a construction contract to be bankable. This article sets out some generic but key requirements that owners should ensure their construction contract possess, and which lenders should look for when deciding to lend, to ensure that the construction contract properly protects their investment.  

Identity of the Contractor

Be confident that the contractor has adequate financial and technical resources to fulfil its contractual obligations and to meet any liability under the construction contract if the project encounters difficulties.  

Although the issue of liability is partially addressed by insurance and performance security (discussed below), this is not enough and you should still be satisfied of the contractor's financial position and the robustness of the contractor's balance sheet.  If the contractor is a subsidiary, you may consider requiring a parent company guarantee to cover any liability that it may incur.