Retention money is deducted from payments to a contractor as a means of securing completion of the project in accordance with the specifications. If the contractor fails to meet the conditions he forfeits those deductions (10%, or is it 5% as a rule?)

A bond serves the same purpose - i.e. covers the client should the work not be completed satisfactorily - but is a bank guarantee.

Given the use of the word retenues I can't see this being a bond, except insofar as it is a "bond" directly between client and contractor.

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Note added at 6 hrs (2010-11-06 21:50:42 GMT)
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There is a case to be had for performance retention however:

Contractor's performance hereunder, the accrued PERFORMANCE RETENTION shall be paid to. Contractor by COFCG. The Contractor may request ...
www.fresnocog.org/files/.../Response to RFP Questions.pdf

Contractors may substitute an escrow agreement for PERFORMANCE RETENTION in accordance with the Public Contract ...
www.co.merced.ca.us/BoardAgenda/2010/MG158944/.../10.TXT

Public Contract Code § 10263 requires a California public entity to include in its invitation for bid and contract documents a provision that: (a) permits the substitution of securities for any moneys withheld by a public agency, or (b) alternatively allows the prime contractor to require the public entity to make payment of the retention to an escrow agent. It should be noted, however, that certain chartered cities and/or counties (e.g. San Francisco or Los Angeles) may be exempt from this requirement.
The statute states: "At the request and expense of the contractor, securities equivalent to the amount withheld shall be deposited with the State Treasurer or, a state or federally chartered bank in this state, as the escrow agent, who shall then pay the moneys to the contractor. Upon satisfactory completion of the contract, the securities shall be returned to the contractor.
Alternatively, the contractor may request and the owner shall make payment of retentions earned directly to the escrow agent. The contractor may direct the investment of the payments into securities and the contractor shall receive the interest earned on the investments upon the same terms provided for in this section for securities deposited by the contractor. Upon satisfactory completion of the contract, the contractor shall receive from the escrow agent all securities, interest, and payments received by the escrow agent from the owner, pursuant to the terms of this section."
Failure to state this right in the bid and contract documents will void any provisions for PERFORMANCE RETENTION in a public agency contract.
http://www.lhfconstructlaw.com/CM/Articles/Articles71.asp

1. All interested licensed “B” General Building Contractors should ... Agency substitute a security in the amount of the PERFORMANCE RETENTION. ...
www.shra.org/Content/DoingBusinessWithSHRA/Bidding/.../2010...

1. Labor Code concerning the employment of apprentices by the contractor or any ... authorized securities in lieu of monies withheld (PERFORMANCE RETENTION). ...
www.cityofhesperia.us/DocumentView.aspx?DID=1119