A Study of Credit Practices in Bills Finance Corporations - A Case of A Photoelectric Company

• Main Authors: Shih Yu Chuang, 莊時雨
• Other Authors: C. H. Chan
• Format: Others
• Published: 2015
• Online Access: http://ndltd.ncl.edu.tw/handle/gy75u2

碩士 === 長庚大學 === 商管專業學院碩士學位學程在職專班財務金融組 === 103 === A case study approach was taken by this study to describe the methods and principles of a current bills finance corporation engaged in credit practices, and discuss the case in accordance with the company’s background, business contents, operational and financial profiles, and general situations of the industry, etc. The purpose is to understand the causes of its bad debts and discuss the improvement measures. As the large shareholder of the said case is a domestic well-known Group, so it expected to find sustenance from the Group to give financial aids and support its operation. However, an oversupply problem encountered by company’s affiliate business markets has caused the prices of its product to fall continuously, and a failure for the Group to give a helping hand has caused its business to get from bad to worse, and unable to repay the debts. Eventually, it had to ask for bailout from Industrial Development Bureau, Ministry of Economic Affairs, but still, the cash flow problems had led the company into bad debts. We have learned from the case study that in future commitments related to credit issues, we should get rid of the myth of the Group and stick to the basics of credit principles by strengthening the key considerations of “source of repayment” and “credit outlook” in 5P credit checking to prevent such incidence to happen again. In addition, the government should also enhance strict checks on corporate bailout application to avoid the occurrence of bad depths even the bailout has been filed by a company. As the bailout is only a short-term emergency measure, the government should conduct re-counseling and business transformation for enterprises going through the sunset industry. This seems to be a more positive measure to solve the problem.