It all starts with a common interest: The credit institution wants to earn money from the loan for the customer, while the customer company needs liquidity to run its business: For the credit institution, every loan also represents a risk, as loans to less solvent customers involve more risk and must be backed by more equity. For the customer company, on the other hand, every loan is associated with costs. A higher liquidity requirement also worsens the rating values and many balance sheet ratios. It regularly happens that either the credit institution or the company, and sometimes both parties, are interested in reducing their credit exposure.
The full article was published in issue 4/2014 of the magazine Kredit & Rating Praxis on pages 19 – 21.
Update: Unfortunately, the publisher ceased publication of the magazine at the end of 2017. Unfortunately, an archive is currently not available online.
