Securities 5000 Balance sheet 10a. Loss of value of the loans, the bank with high initial capital level. Assets ( ths.) Liabilities ( ths.) Reserves 60 Deposits 30000 Loans 30450 Bank Capital 5510 Securities 5000 The main reason to keep the bank capital on the certain level is to reduce the probability of becoming insolvent. The higher the capital is, the lower the 12 probability of failure. The cost of this safety is carried by owners by lower returns on equity. 5.2.5.Asset Management 5.2.6.Liability and Asset-Liability Management 5.2.7.Summary 5.3. Basics of Financial Intermediaries Financial intermediation AG, ch. 13 15), (structure (direct and indirect,
Submis- sion of the application for liquidation and the cancellation of registration are carried out within the same term and at the same cost as in the case of registration or reorganization of a company. Principles and features of insolvency procedures In the process of operation, a company may face financial hardship when it is not in the posi- tion to honor its obligations to creditors and thus, the company becomes insolvent. Insolvency procedures are regulated by the Law on Insolvency Procedures. In the case of insolvency, the director(s) of the company is obliged to make an announcement about insolvency in due time. The legislation on insolvency procedures is focused on the balanced protection of the interests of debtor company and its creditors, and if possible, allows the insolvent company to solve its financial problems and avoid bankruptcy.
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