- Published: Wednesday, 14 March 2012 18:07
When your company has a substantial increase in bank loans, this is a concern for a company's stability. Seasonal borrowings, which are entirely paid off after that sales period, are a looked upon favorably by banks. However, permanent bank loans is an indication that the company needs some sort of long term capital such as stocks or bonds. Also, if they are growing faster than sales and profits over a period of years, this is definitely a sign of financial weakness. So, be careful in the loans you choose to get from a bank. Choose carefully and pay them off quickly.