Debtor's solvency:
Banks or financial institutions usually consider the debtor's solvency when issuing loans. If the debtor fails to repay the loan on time, banks or financial institutions need to consider implementing credit withdrawal. When judging the debtor's solvency, it is necessary to consider its financial status, cash flow status, profitability and operational stability.
Guarantee and mortgage of loans:
Loan guarantee and mortgage are important means for banks or financial institutions to reduce credit risk. When the borrower fails to repay the loan on time, the bank or financial institution may recover part or all of the loan according to the value of the guarantee and collateral. Therefore, when implementing credit withdrawal, we need to consider the value and availability of guarantees and collateral.
Industry and macroeconomic environment:
The industry and macroeconomic environment have an important impact on the borrower's operating conditions and credit risk. When the industry is depressed or the macroeconomic environment is unfavorable, the borrower's operating conditions may be affected, resulting in its inability to repay on time. At this time, banks or financial institutions need to consider implementing credit withdrawal to reduce credit risk.
Characteristics of credit:
1, repayment:
Credit is a kind of lending behavior, and the borrower needs to repay the principal and interest to the lender at the agreed time and interest rate. Repayment is one of the most basic characteristics of credit, which ensures the safety of the lender's funds.
2. Liquidity:
The liquidity of credit means that borrowers can apply for loans from lenders at any time, and lenders can also transfer loans to other investors at any time. This liquidity makes credit a very flexible financial tool.
3. Profitability:
The profitability of credit means that lenders can get interest income. In the credit market, the interest rates of loans with different maturities and risks will be different, and lenders can get different benefits by choosing different credit products.
4. Risks:
Credit risk means that the borrower may not be able to repay the loan principal and interest on time, which will bring losses to the lender. Therefore, before granting loans, banks or financial institutions need to comprehensively evaluate the credit status and financial status of borrowers in order to reduce credit risk.