When considering making a loan to a company,a bank will look for:

Question

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A low debt ratio indicates that the company has less debt relative to its assets, which is considered a positive factor for loan approval. A high current ratio indicates that the company has enough current assets (such as cash and inventory) to cover its short-term obligations (such as bills and debts), which is also a positive factor for loan approval. Therefore, a bank would prefer a company with a low debt ratio and a high current ratio when considering making a loan.

When Considering Making a Loan to a Company,a Bank Will