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The Cost of Bank Credit Financing

Author

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  • Mihaela Cosmina Petre (Nita)

    () (“Constantin Brâncoveanu” University Pitesti)

Abstract

Although the credit is a conventional financing method used by any company, this tool is by far a very significant issue. The range of credits, that a bank provides, and the current policy customize this tool in order to meet the typical financing needs of the enterprises that demands it. Considering the risks, the bank takes the charge of by placing credits, the “eligibility” terms of enterprises that can get such financing being very strict. Restrictions concerning the accepted degree of liability, the accomplished level of performance or available warranties may represent real “barriers” for many companies. Of all “barriers”, the high cost of some financing tools is a good case in point. In order to have a clearer picture of what this financing source is for an enterprise, I have carried out a cost analysis of these financing tools, the medium and long term credit cost and the short term credit cost.

Suggested Citation

  • Mihaela Cosmina Petre (Nita), 2007. "The Cost of Bank Credit Financing," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 1(1), pages 119-132, September.
  • Handle: RePEc:dug:actaec:y:2007:i:1:p:119-132
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    File URL: http://journals.univ-danubius.ro/index.php/oeconomica/article/viewFile/49/46
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    Cited by:

    1. Madalina – Gabriela Anghel & Aurelian DIACONU & Georgiana NITA & Andreea Ioana MARINESCU, 2016. "Analysis Model of credit Risk," Romanian Statistical Review Supplement, Romanian Statistical Review, vol. 64(5), pages 43-48, May.

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