haku: @indexterm Corporate finance / yhteensä: 722
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| Tekijä: | Li, Shah |
| Otsikko: | It's questionable to offset loans by confiscation of property (original in Chinese) |
| Lehti: | China Reform (c)
1998 : 9, p.43-44 |
| Asiasana: | DEBT LOANS ASSETS CORPORATE FINANCE |
| Kieli: | chn |
| Tiivistelmä: | Offsetting loans by confiscation of property is a behaviour which means when enterprises fail to carry out their obligations in paying debts which become due, financial institutions will carry out the transfer of right of use or ownership of capital goods occupied by enterprises to creditors and they will offset the principal and interest of loans in debt. Off setting loans by confiscation exerts certain influence on the improvement of the relation between banks and enterprises. However, this is based on the premise of the indefinite prolongation of the payout period of loans. It is the accumulation of medium and long term fixed assets, which used to be short-term liquid assets. The gap between their book value and market value become wider and wider, which causes the false impression of the improvement of asset quality and financial safety. |
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