Bank Lending Report
CREDIT ASSESSMENT PROPOSAL
NEEDS OF CLIENTS
Lettera Pty Ltd requires a mortgage loan of $320 000 to purchase the existing premises (worth $3800 00) that the company is operating on. Mortgage loan interest rate is $8 per annum compounded monthly and repayment period over 25 years. The purpose of this mortgage loan is to save over $9 000 per month on the rental of premises. The source of repayment comes from the company’s operating incomes.
In addition to the $320000 loan, Lettera wishes to increase the existing overdraft facility from $60000 to $140 000. This allows the company to put down a deposit of $60 000 on the building and pay the transfer fee of $20 000.
BACKGROUND
The Business: A profile
Lettera, which is a proprietary limited company, abbreviated as 'Pty Ltd' is a business structure that has at least one shareholder with a limited number of shares. The company limited by shares, where shareholders are afforded more protection when it comes to the level of liability that they face for company debts. In this case, the type of business for the Lettera (Pty) Ltd is printing and it has existed for five years in the printing industry.
The Printing industry consists of establishments mainly engaged in commercial or job printing (including commission printing of paper stationery), including printing onto textiles or other surfaces. Regarding to the industry of printing in Australia, the printing and graphic communications industry is the third largest in the manufacturing world. In Australia the industry employs over 120,000 people in 6,000 businesses. The value of production from this industry is over $15 billion. In an industry this big there has to be great career opportunities.
However, there are some risks or difficulties exist in the printing business environment even though the prospects of that are good. Competition is one of the major parts of risk in every industry. In this case, the competition appear when there are rumours that an existing
NEEDS OF CLIENTS
Lettera Pty Ltd requires a mortgage loan of $320 000 to purchase the existing premises (worth $3800 00) that the company is operating on. Mortgage loan interest rate is $8 per annum compounded monthly and repayment period over 25 years. The purpose of this mortgage loan is to save over $9 000 per month on the rental of premises. The source of repayment comes from the company’s operating incomes.
In addition to the $320000 loan, Lettera wishes to increase the existing overdraft facility from $60000 to $140 000. This allows the company to put down a deposit of $60 000 on the building and pay the transfer fee of $20 000.
BACKGROUND
The Business: A profile
Lettera, which is a proprietary limited company, abbreviated as 'Pty Ltd' is a business structure that has at least one shareholder with a limited number of shares. The company limited by shares, where shareholders are afforded more protection when it comes to the level of liability that they face for company debts. In this case, the type of business for the Lettera (Pty) Ltd is printing and it has existed for five years in the printing industry.
The Printing industry consists of establishments mainly engaged in commercial or job printing (including commission printing of paper stationery), including printing onto textiles or other surfaces. Regarding to the industry of printing in Australia, the printing and graphic communications industry is the third largest in the manufacturing world. In Australia the industry employs over 120,000 people in 6,000 businesses. The value of production from this industry is over $15 billion. In an industry this big there has to be great career opportunities.
However, there are some risks or difficulties exist in the printing business environment even though the prospects of that are good. Competition is one of the major parts of risk in every industry. In this case, the competition appear when there are rumours that an existing