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Ratios which bankers consider to grant a short-term loan

Which ratios the bankers are most interested in while considering whether to grant a short-term business loan?

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Bankers and other lenders mainly make use of liquidity ratios to judge whether to extend short-term credit to a firm.  Liquidity ratios define the capability of a firm in meeting its short-term obligations.


These ratios are of quite significance because failure to pay these obligations leads to bankruptcy. The higher is the value of the liquidity ratio, the more capable a firm is in paying its small-term obligations.

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