Bank debts: anemic cash flow

The fluctuations and bank debts that occur in corporate cash makes the day to day life of financials challenging.

This balance with the due terms is natural in any company, the search for equalization means that managers often have to have credit options with reduced rates to cover possible shortages of own resources.

The Weight of Bank Liabilities in Cash

debt loan

When the company has banks as a “special partner”, that is, in addition to needing banking services, it is a “continuous borrower”, the company relationship with banks becomes the “Calcanhar de
Achilles ”of Financial Management; an emotional one is put in place to strengthen this “partnership”, however, banks are for-profit financial institutions (and profits are very high, as we can see in large newspapers, in the economic notebooks).

The relationship goes very well until the risk of possible default arises. In view of this, negative situations may occur, including: suspension of credit lines, increased interest rates, reduced payment terms, in addition to the requirement for even greater guarantees.

And the debt burden only increases

What was no longer easy is even worse, as the points mentioned above make debt even more expensive and consequently make the “cashier bleed”. At this time, the emotional of management is sensitive, even too much, the management of the company as a whole focuses solely and exclusively on Finance, the risk of default increases every day.

Cashier is “Asphyxiated”, ie “Dehydrated”

Cashier is “Asphyxiated”, ie “Dehydrated”

Conducting the company in this way is almost “throwing money down the drain”, as the management’s concern is no longer low-cost operations, but financial operations to fulfill urgent commitments.

The cashier works at ZERO constantly, when it is not negative, paying absurd overdraft fees. It turns out to be a timely way for banks to take advantage of the moment.

This situation needs to be “Restructured”

debt problem

To continue with a management in this way is to condemn the company to bankruptcy, this player needs to be conducted in a way that suits all parties, not only banks.

At this moment, specialists in Bank Debt Renegotiation can certainly carry out an Administrative Negotiation process, which, after analyzing the company’s economic and financial structure, present to the banks, after repeated negotiations, the company’s proposal to restructure the Bank Liabilities, with values installments that adjust the firm’s ability to pay, rather than the values ​​set by banks, which is common in this process.

This scenario is possible, however, it will only be obtained with the participation of specialists, professionals who know the whole process and the bank procedures so that with this knowledge they can use them in a
professional in favor of the company.

Does your company live in a similar situation?

Does your company live in a similar situation?

Unfortunately this process is a matter of time, when the cash outflow is high, the longer it is expected, the more damage is caused to the management, and finally, this negotiation should occur, however, in view of the time it was expected to perform it. , sure will be more expensive the company.