Anyone:
I'm rather stunned that you dismiss so easily Mr. Sylver's credit history.
...Banks and institutions have their own criteria, and they will decide based on what they believe will happen....
Would you be interested in Banks' and Institutional criteria?
Estimation of Credit Risk: Analyst Method. Having compiled a basic file of information and investigated avenues suggested by inconsistencies, derogatory comments and favorable opinions, The analyst assesses the willingness and ability of the applicant to repay. The traditional standard has been the "four C's of credit: character, capacity capital and conditions. Each of these describes an area of the person or firms credit worthiness.
1. Character. The quality of desiring to repay debts when due is ranked above all considerations. Of course honesty is a necessity, but character implies integrity and empathy for the lender's position as well. An established credit record (substantial borrowing and voluntary repayment) is one of the best evidences of a business's or individual's willingness to repay. Also, character is implied by the applicants positions of trust accepted and fulfilled in business and social organizations. The character of business organizations follow that of top management, its facilities for keeping records, the routinization of office functions, and relations with employees.
2. Capacity. Capacity is the ability to repay debts as scheduled.....
3. Capital. This is net worth or equity (assets minus liabilities); it provides a cushion to absorb operating and asset losses that might otherwise impair debt repayment....
4. Conditions. Borrowers may be subject to unfavorable economic conditions beyond their control.....
The analyst mentally takes account of the four C's weighing each according to the particular circumstances. However, a general statement as to the usual importance of these factors can be made. Risk is dependent upon the quality found in each factor and the combination of the four C's. Assuming the same conditions prevail, these guidelines are suggested, beginning with the best possible combinations.
Applicant Characteristics Credit Risk
Character capacity and capital very low
Character and capacity without capital low to moderate
Character and capital but insufficient capacity low to moderate
Capital and capacity but impaired character moderate
Capacity and capital without character High
Character and capital without capacity High
Character without capacity without capital Very High
Capital without character without capacity Very High
Capacity without character without capital Fraudulent
Source: Financial Institutions: Markets and Management. Robert Edmister.
Given late regulatory filings, filings replete with inconsistency and perhaps deliberate misstatements of fact, its affiliation with less than reputable individuals, i.e., Fasano, management's track record regarding its willingness to repay debts when due and other items too numerous to mention, I would hypothesize that a commercial lender would rather give money to a panhandler than loan this company a dollar. Sophisticated equity investors will employ the same methodology and standards. So where will this company get the funds to continue operating?
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