The Loan Creditor Group

This group includes a wide range of banks, business organizations and individuals who have provided loans and credit to the organization. Part of this group will be secured, which means that they have obtained some specific legal rights to recover the money owing to them if the organization gets itself into financial difficulty. Others will be unsecured; if the business fails they will only get their money repaid to them if there are sufficient assets after preferential and secured creditors have had first claim. Whilst all types of creditor rank before shareholders for repayment this is small comfort if the organization ends up with a major deficit leaving them unpaid? Thus all this creditor group have a major interest in the success of the group and in particular in financial policies which minimize the risk of loss to creditors. Clearly lenders committed to long-term lending to an organization may have a longer term perspective than short-term loan creditors, but fundamentally they have a business interest. Their rights to act against management policies may be included in the lending agreement particularly for long-term lenders. Short-term lenders will be more likely to act by demanding immediate repayment and refusing to extend further credit where they are unhappy with the management

Дата добавления: 2015-08-17