Reborn Industrial Tycoon

Chapter 600 Looking for a loan

Financing for private enterprises has always been a problem, and borrowing from banks has always been very difficult.

Also because of the difficulty in financing, most private enterprises will choose to go public after reaching a certain scale to solve the problem of corporate financing.

Of course, there are also capitalists who go there simply to make money. This type of people can no longer be regarded as entrepreneurs. Real entrepreneurs will not raise funds just to make money.

In the early 1990s, banks were begging others for loans. At that time, loan interest rates were often as high as more than ten percent, which was simply legal usury. Naturally, banks were rushing to lend money.

Also during the corporate reform process in the 1990s, too many companies went bankrupt and closed, which also caused banks to generate a large amount of bad debt repayments. Therefore, banks gradually became stricter in lending to companies.

Especially after banks began to become commercialized, they paid more attention to economic benefits. Every loan was a business and they had to focus on profitability. This also exacerbated the difficulties of private enterprises in obtaining loans.

The financial industry is destined to hate the poor and love the rich. The more funds are scarce and companies in need of loans, the more banks are reluctant to lend. The more money they have and the companies that do not need loans, the more banks rush to provide money.

In fact, when financial institutions grant loans, they first consider the safety of capital, followed by profitability.

Security is easier to understand. It means whether the money given to you is safe. When lending money to others, the first thing to consider is whether the money will be wasted.

If the borrower is an enterprise, then the financial institution will evaluate a series of factors such as the industry, market, competition, operations, management, technology, etc. to which the enterprise belongs. To put it bluntly, it means whether you have the ability to repay the loan.

However, many private enterprises, especially small and medium-sized private enterprises, have unstandardized management, backward technical levels, insufficient corporate credit, and very limited assets, so banks are naturally unwilling to lend.

In addition, the company's cash flow is also a major factor that banks consider. After all, cash flow is the primary source of bank repayments.

However, the financial statements of small and medium-sized enterprises are usually not audited by professional accounting firms, and there are many cases of smuggling of accounts. The accounts are inaccurate and have little reference significance for banks.

The bank cannot verify the authenticity of the information provided by the company, and therefore cannot judge the company's true operating conditions, so it simply chooses not to lend money for the sake of the safety of funds.

I would rather make less money than do a loss-making business!

It is also because it is difficult to get loans and the loan interest is high, so Li Weidong's companies rarely seek bank loans during the expansion process, but mainly use their own cash flow.

As for electrical appliance factories, they mainly do OEM for home appliances. This is a labor-intensive industry. In fact, they are only responsible for production and not sales. Although they make hard money, they do not need to bear market risks.

Regardless of whether the product can be sold or not, I earn the processing fee first. This is a characteristic of OEM companies. Only when building a factory, relatively large funds are needed. Once production is on track, the cash flow will be relatively healthy.

, there is not much demand for bank loans.

The Puppy Electric Company made some money in the past few years by relying on high-profit products such as soy milk machines and microwave ovens. Later, Li Weidong launched a price war, and the prices of Puppy Electric's products were significantly reduced, and this part of the profit was diluted.

Fortunately, Puppy Electric has successfully entered the Japanese market and made huge profits by selling beauty products. Its capital flow has always been relatively healthy.

Puppy Health originally started by selling health care products. Health care products are real huge profits, and Puppy Health is extremely rich. If you calculate carefully, in the past ten years, Puppy Health has been Li Weidong's largest source of income.

The efficiency of Fukang Engineering has also maintained steady growth. This is due to the country's continuous investment in assumptions, and it has just won a large order from India. The company's cash flow is very abundant, which is enough to buy another piece of land to build a new factory.

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As for Fukang Agricultural Machinery, it has made huge profits with its agricultural tricycle product in the past few years. In the past two years, it has maintained good performance by selling cotton harvesters.

Moreover, Fukang Engineering and Fukang Agricultural Machinery are both traditional machinery manufacturing companies. If this type of company is operating normally, it will not need financing as long as it does not undertake major projects.

The financial situation of the manufacturing industries that Li Weidong is engaged in is relatively healthy, and there is no need to seek bank loans.

But wholesale malls are different. Wholesale malls are not manufacturing, but related to commerce. To be precise, they are commercial real estate.

Commercial real estate is also real estate. In the real estate industry, instead of going to a bank for a loan, you get real money yourself. Wouldn’t that be silly?

If Li Weidong's wholesale mall wants to continue to expand, it must solve the loan problem.

…

President Wu brewed the best Pu'er, served Li Weidong some tea himself, and said at the same time: "Chairman Li, it's not that I don't want loans, but it's really difficult for companies to get loans now.

You also know that many companies have gone bankrupt in the past few years, and the loans issued by our banks have also been in vain, only bringing us huge losses. Therefore, in the past two years, loans have been generally tightened, and the review process has been relatively strict.

strict.

Take our bank as an example. Any loan exceeding 3 million must be reported to the provincial bank. If it exceeds 10 million, it must be reported to the head office in Beijing. The loan amount you want must not only be reported but also approved by the head office.

"

Li Weidong picked up the tea cup and took a sip, and then said: "President Wu, as far as I know, it is easy for state-owned enterprises to get loans, right? I won't talk about other companies. The transportation company is going to build a new bus station, and the loan will be approved immediately.

Got it!

To put it bluntly, the efficiency of transportation companies in recent years has not been very good. They have sold all their cars to individuals and contracted out passenger lines, and they have only made some income by collecting contract management fees."

"After all, the transportation company is a state-owned enterprise, so the state has the guarantee. Moreover, the new bus station project is also a key project planned by the city. It is considered a livelihood project, so we can feel more secure in lending money."

President Wu paused and then said: "Chairman Li, the wholesale mall you want to build is a commercial project after all, and it is risky. And with such a large amount of funds, it is not likely that the head office will approve it."

"Then let me get a mortgage loan, let's go to the head office like this!" Li Weidong asked.

"If there is a mortgage, I can try to persuade the head office leaders." President Wu then asked, "Chairman Li, what do you plan to use as a mortgage? We have agreed in advance that we will not accept the mortgage of machinery, equipment and goods."

In the past, banks were willing to accept mortgages on machinery, equipment and goods. Especially in the 1990s, many companies pledged production equipment and products to banks to obtain loans in order to obtain funds.

However, things like machinery and equipment depreciate very quickly. What's more, the machinery and equipment mortgaged by many companies are already relatively old. If they still can't pay back the money in the future, the machinery and equipment taken back by the bank can only be sold as scrap metal.

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The situation of goods mortgage is similar. Many companies are short of funds. In the final analysis, it is because the products they produce are relatively old and can no longer meet the market demand. If the products cannot be sold, the companies will naturally be short of money.

If the company itself cannot sell these products, how can the bank find a market? So even if this kind of collateral falls into the hands of the bank, it is almost like a distribution.

Based on this calculation, whether it is using machinery and equipment as collateral or goods as collateral, the bank will lose money.

The bank also knows that it is too troublesome to dispose of machinery and equipment and goods, and the cost cannot be recovered, so they simply do not accept mortgages for machinery, equipment and goods.

Li Weidong knew the secrets here, so he said, "I can use the land and real estate in the wholesale mall as a mortgage."

Manager Wu frowned slightly and then said, "Chairman Li, I remember that the textile wholesale mall has been mortgaged. You are building the small home appliance wholesale mall. Wasn't it built with that loan?"

"The small home appliance wholesale mall has been built. I can use this small home appliance wholesale mall as collateral to apply for a loan." Li Weidong said.

"I'm afraid this will be difficult." President Wu continued: "At the beginning, we were willing to accept the textile wholesale mall as a mortgage, mainly because the textile wholesale mall was successfully opened, and the rent and management fees you collected can repay the loan.

But now the small home appliance wholesale mall has not opened yet, and we don’t know whether this project can make money. If this project is unsuccessful, it will only be regarded as a useless and empty building, which is worthless.”

"Even if the small home appliance mall can't be built, isn't there still land?" Li Weidong said, but as soon as the words came out, he immediately realized that this was the year 2000, not twenty years later, and the land was not valuable.

Sure enough, President Wu said: "Land is not worth much, and the payment received is very limited."

In future generations, housing mortgage loans will be at a 30% discount, shops at a 40% discount, factory buildings and land use rights mortgages at a 50% discount, and mortgage rates for houses in school districts and prosperous shops will be higher.

However, in 2000, housing prices had not yet risen, and the mortgage discount for real estate was much lower than in the future; the price of land was even very cheap, and the mortgage could not be paid for much.

Li Weidong thought for a moment and said, "Well, I can use the company's shares as collateral to apply for a loan."

"The shares of Fukang Factory or Fukang Agricultural Machinery may be possible, but the shares of the mall management company are definitely not."

President Wu went on to explain: "At present, the profit of the mall management company mainly depends on the rent from the textile wholesale market, but the textile wholesale market has been mortgaged. This is equivalent to a mortgage. It has been mortgaged twice. The head office must pass

But."

Li Weidong frowned. Li Weidong's shares in Fukang Engineering and Fukang Agricultural Machinery will still be of great use in the future.

At the very least, both companies have the possibility of listing, so the equity must be clear and clear. If it is used as a mortgage, there may be trouble with the approval of the China Securities Regulatory Commission when it comes to listing.

President Wu went on to say: "Actually, even if you pledge shares of Fukang Engineering or Fukang Agricultural Machinery, it will take a long time to review. After all, you are not a listed company. The head office will have to review your financial statements and only if you meet the conditions will you dare to lend.

.”

Loans from banks using shares are a type of pledge loan. The most common pledge loans made by banks are also stock pledges.

However, the stocks pledged are often the stocks of listed companies, because the stocks of listed companies have an actual price, and the financial reports are relatively transparent, and banks can clearly understand the company's situation.

If it is not a listed company, it will be more troublesome to pledge the shares. The bank must evaluate the value of the shares and check the company's financial reports. It must be a company with good profitability before it can lend.

As for the shares of small and medium-sized enterprises, they are usually insulated from pledged loans.

"The lending time is too long and it will delay things." Li Weidong directly found an excuse to refuse.

"Then I have no other solution." President Wu spread his hands.

Li Weidong pondered for a moment, and then asked: "President Wu, if I apply for a real estate development loan, is it likely that it will be approved?"

"Well..." President Wu frowned and thought for a while, then said, "I really don't know about this, because I have never done this kind of business here.

As far as I know, the companies currently applying for real estate development loans are real estate companies in big cities or southern coastal areas, especially in the Pearl River Delta.

In a small place like Qinghe, we don’t have a decent real estate developer yet, and no one has applied for this kind of thing, so I don’t know if you can succeed if you apply.”

Li Weidong said: "I also know that it is difficult to apply for a real estate development loan, but it depends on the person. I still want to give it a try, so I will leave it to President Wu for the process. As for other aspects, I will find a way!"

…

Real estate development loans refer to project loans issued to real estate development companies for housing, commercial housing and other real estate construction. The loan period generally does not exceed three years.

If a real estate development company wants to obtain this kind of loan, it must first obtain the land use rights of the loan project, a planning investment permit, a construction permit, a construction permit, etc. Commercial houses must also have a pre-sale permit.

The project must also be consistent with the declared purpose and function, the project budget and construction plan must comply with laws and regulations, and the investor must invest at least 30% of the project funds in advance, so that the remaining 70% can be borrowed from the bank.

Many people in later generations said that real estate developers use bank money to build houses, which actually refers to this real estate development loan.

Because for this loan, as long as the project is compliant, the documents are complete, and then you invest 30% of the capital, you can get the loan, which is similar to a credit loan.

In addition, there is a pre-sale policy for real estate, and real estate development companies can sell houses in advance to withdraw funds. The actual investment capital is actually less than 30%. Therefore, some people say that developing real estate is a waste of money.

The ones who are really free of charge are those who hold the floor plan, point to an open space and conduct pre-sales in violation of regulations.

Wait until 30% of the advance payment is collected, and then use this money to apply for a real estate development loan from the bank to complete the entire project. In this case, you don't have to pay a penny, and you are 100% borrowed to lay the eggs.

In the past, the so-called real estate companies' funds were broken and unfinished buildings were produced. This was the case in nine cases out of ten.

The real estate company first draws up a plan, or digs a foundation, or even starts building the house, just to receive an advance payment.

Sometimes the advance payment is less than 30%, or the project does not match the declaration, and the real estate development loan cannot be approved. The capital chain is naturally broken, and then the house is unfinished! The developer takes away all the remaining money and runs away.

In the end, those who paid the rent in advance were the ones who suffered.

That’s why the relevant departments constantly remind you that when buying a house, you must look for the so-called five certificates. This not only involves issues such as applying for a real estate certificate later, but also because only projects with these five certificates can apply for real estate development loans.

Only the funding chain of this project is guaranteed.

Before 2003, it was relatively difficult to apply for a real estate development loan.

First, it was because banks at that time were still in the stage of commercial transformation and were relatively cautious about lending. This situation did not begin to improve until the State Council launched the joint-stock reform of state-owned banks in 2004.

The main reason is national policy factors. Until June 2003, the central bank's "Notice on Further Strengthening the Management of Real Estate Credit Business" still controlled real estate development loans. Since the state is controlling, banks will naturally not lend easily.

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Until August 2003, the State Council promulgated the "Notice on Promoting the Sustained and Healthy Development of the Real Estate Market," which is the famous Document No. 18 in the real estate industry, requiring "continue to increase credit support for qualified real estate development enterprises and real estate projects."

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Since then, credit for real estate development has gradually been liberalized. With the support of bank credit, Chinese real estate companies have officially embarked on the path of rise.

In 2000, due to various restrictions, only real estate companies with deeper backgrounds and stronger connections had the opportunity to obtain this real estate development loan. Even if ordinary real estate companies are qualified, it is difficult to apply for real estate development loans.

Development loans.

There are still more than 100 monthly passes left, and it’s the last two days of this month. My lovely book friends will work harder to help pass the test. I would like to thank you all!