Financial Markets and Bank Management Essay Example | Topics and Well Written Essays - 1000 words - 2

Financial Markets and Bank Management - Essay ExampleWe understand that you wish to expand your championship operations and therefore, your fund requirement has increase. Our observations on your firms sleep sheet are as per the following.The current ratio of the firm has declined in the socio-economic class just completed though it still cincture above 1.0 however, the quick ratio appears to be under strain. We notice that the acid-test ratio has gone down below 0.50 in the latest financial year. Net margin has also declined from 2.5 part in year 2013 to 2.1 percent in the latest fiscal. Moreover, the net interest cover of the firm has also declined from 3.0 times to 2.7 times that provides peripheral safety net for the firm in the current sluggish business environment. The declining stock turnover (in days) year after year is a good sign. In fact, it also establishes the declining needs of the working capital for your business. We yield worked out the working capital requir ement for your firm based on the information provided by you. The increased working capital requirement for the projected sales of 1,550,000 is likely to be 167,000 (working in annexure A). Considering the strength of your balance sheet and increased working capital requirement, our bank increases existing overdraft limit from 90,000 to 180,000 and that should be adequate to go steady your requirements.Our bank is in receipt of your bestow request to increase the overdraft facility to 10,000. We understand that you have to lose some essential expenses such as school fees for your son. Kindly find our detailed reply to your loan application in the following paragraphs.We extend overdraft facility to our valued customers essentially to meet some contingencies and mien out temporary cash flow issues when you fail to receive your dues in time. Though you started with initial overdraft of 2,000 it has steadily increased and has reached to 3,600. We notice