Credit insurer plans to cut cover for suppliers of UK housebuilder Vistry, FT reports

Aug 10 (Reuters) - Credit insurer Allianz Trade plans to cut coverage for suppliers to Vistry, the Financial Times reported on Saturday, a move that could add pressure on the British affordable housing builder's cash flow as it seeks to reduce debt and control costs.

Shares in Vistry fell more than 9% on Monday, the biggest loss on the FTSE mid-cap index.

Here are some details: 

• Allianz Trade could cut insurance cover for Vistry's suppliers by up to 70%, with the final level tied to the company's financial performance, the FT said, citing people familiar with the decision.

• Trade credit insurance protects suppliers against the risk of customers failing to pay their bills. Insurers such as Allianz Trade set credit limits for individual buyers and adjust them as their view of the buyers' financial health changes.

• The changes to credit limits will affect new trading agreements with Vistry and do not apply retroactively, the FT said.

• Allianz Trade declined to provide details on companies under its coverage in response to a Reuters query.

• "We are not aware of any supplier withdrawing trade from Vistry due to credit insurance changes and we have seen no interruptions to our supply chain" a Vistry spokesperson told Reuters

• Kent, England-based Vistry said it continues to expect a net cash position in excess of £100 million ($135.01 million) at the end of 2026.

• Vistry, which has warned of a first-half pre-tax loss, has cut spending and building activity as high mortgage rates and rising build costs tied to energy prices after the Iran war weigh on the housing market.

($1 = £0.7407)

(Reporting by Raechel Thankam Job in Bengaluru; Editing by Tasim Zahid)