Hundreds of reasons can turn even the loftiest of dreams of success to a big failure and a resounding bankruptcy. For one, we have a highly competitive business environment where one has to “swim with the sharks” or be eaten alive.
There is a sluggish development globally, rising oil and commodity prices, inflation which results in failed projections and less profit from whence the money should have come to pay for say, a loan.
Lenders have to fully apply their understanding of the risks involved when large amounts of money are released to a borrower for possible investment. The evaluation process is indeed a sophisticated and hard task.
Extreme expertise and professionalism are needed to get the right reading and evaluation of the credit worthiness and the type of investment of a borrower.
If the experts fail to do this then we should be ready to have a lot of non-performing assets on our hands.