1. The success or failure of business activities
For enterprises operating with debt, the funds for repaying principal and interest ultimately come from corporate income. If the business management is poor and the company suffers long-term losses, the company will not be able to pay the principal and interest of the debt on time, which will put pressure on the company to repay the debt. It may also damage the company's reputation and prevent it from effectively raising funds, causing the company to fall into financial risks. .
2. Liability structure
Whether the ratio of borrowed funds to self-owned funds is appropriate and related to the enterprise Financial benefits and risks are also closely related. Under the influence of financial leverage, when the investment profit rate is higher than the interest rate, the enterprise expands the scale of liabilities and appropriately increases the ratio between borrowed funds and own funds, which will increase the enterprise's return on equity capital. On the contrary, when the investment profit rate is lower than the interest rate, the more debt a company has, the higher the ratio of borrowed funds to its own funds, and the lower the company's return on equity capital. In severe cases, the company may suffer losses or even go bankrupt.
3. Interest rate changes
When companies raise funds, they may face risks caused by interest rate changes . The level of interest rates directly determines the cost of capital for enterprises. When the country implements the "double easing" policy, that is, an expansionary fiscal policy and a loose monetary policy, the supply of money increases and the interest rate on loans decreases. When enterprises raise funds at this time, the capital cost is lower, and the operating costs borne by the enterprise are lower. This reduces the financing risk of enterprises; on the contrary, when the "double tight" policy is implemented, that is, tight fiscal policy and monetary policy, the supply of money shrinks and the interest rate of loans increases. At this time, enterprises raise funds, and the cost of funds With the increase, the operating costs borne by the enterprise will increase, so the enterprise will bear greater financing risks.
4. Exchange rate changes
If an enterprise borrows foreign currency, it may also face risks caused by exchange rate changes , when the borrowed foreign currency appreciates during the borrowing period, the business maturesThe actual value of repaying the principal and interest is higher than the value at the time of borrowing. When the exchange rate changes in the opposite direction, that is, when the borrowed foreign currency depreciates, the borrowing enterprise can obtain "holding income", that is, due to the depreciation of the borrowed foreign currency, the principal will still be returned according to the borrowed amount at maturity, and interest will be paid at the original interest rate. Reduce the value of the actual return of principal and interest.
5. Debt structure
Debt structure refers to the financing raised by enterprises through different financing channels The relationship between the coming funds and the proportion of funds. From a broad perspective, the diversification of the four debt methods of bank loans, bond issuance, financial leasing, and commercial credit enables enterprises to obtain the funds they need not only through bank loans, but also through commercial credit and securities markets. funds. However, different debt financing methods have different difficulty in obtaining funds, so their capital cost levels are different, and the degree of constraints on enterprises is also different. Therefore, the impact on corporate income is definitely different. Therefore, debt financing risks The degree is also different.
The above is the risk of debt financing summarized by the editor of Legal Savior Network. I hope it can be helpful to everyone.
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