(c) Assume that the bank has approved the following financing to Chicks Sdn. Bhd. and full disbursement was made on 10 July 2016.. No Type of Financing Purchase Price Market Value Financing Rate(%) Financing Tenure Amount (RM) 1,500,000.00 15 years 800,000.00 15 years 1 Land 3.0% 2.000.000.00 1.000.000.00 2 3.5% 3. Factory building Machineries Vehicle Total 550,000.00 400,000.00 950,000.00 3.000.000.00 4 500,000.00 7 years 300,000.00 9 years 3.100.000,00 3.5% 4.0% The company started its operations at the factory with new machineries at the end of January 2015 and recorded a 70% increase in sales for financial year ended 31 December 2015. The performance remains consistent in year 2016 and the company has been prompted in servicing monthly instalment (1) Suggest ONE (1) type of collateral can be taken by the bank to secure each of the above financing. Calculate collateral value for each of the financing (16 marks) However, the financial performance starts deteriorating in the second quarter of year 2017. Even though the company recorded consistent sales during the financial year ended 31 December 2017, the company suffered a significant reduction of 60% in their net profit Based on your analysis, the raw materials cost significantly increase due to the high exchange rate of Ringgit Malaysia, while the selling price remained the same. The company experienced very tight cash flow to oblige the financing monthly instalment. (2) Based on the above, evaluate the company's condition and formulate the suitable recovery plan. Support your recovery plan with THREE (3) justifications. (15 marks) In the fourth quarter of the year 2017, the bank officer detected few waming signals during the credit review. The CEO of the company is uncontactable. At the same time, the company has submitted three (3) requests to change the financing terms. As of November 2017, the company failed to submit its audited accounts for financial year ended 31 December 2016 despite several reminders sent by the bank to the company. As at 31 November 2017, the company has not paid monthly instalment for the factory and machineries for four (4) months. The site visit was conducted and it was found that the factory was not in operation. Based on the conversation with the workers of the next door factory, the factory has been closed for almost one month. Based on the above- (h) Suggest how the bank can get the fastest recovery from all the collateral taken to secure the financing in question (1) above. (4 marks) (1) Assume that the collateral value in (h) is not sufficient to cover the outstanding balance of the financing. Advise the suitable credit recovery plan in this situation. (4 marks) C) Identify and explain all important documents needed in credit recovery plan suggested in (1) above (8 marks) Total: 80 marks Click Sdn Bhd is a manufac company that produces from food producte inchading chicken popcoemugge chicken wings and chicken fingers with Chickeband. It red operation as a home used product in the year 2014 and das high demand, tesness Beds to expand their business typing medium sed factory with cestrale che increase the prodati pery. The business is a family business and the ship and most recen follows: Ne Names Ape Slaars) in Anh CEO Lineral Investment Dirone Account RM 350,000.00 ated with Mumat Malaysia the Ons were bouse located in Kajang with market value RMS 1 P A 30 Drew Chwns Public Listed Company Slures in KESE RM 270.000.000 3 Hi Aishah 59 30 ONS ASB rest of RM 2000 Ex Nami is the sea Aishah and he is the key person who is responsible for the prechte und daily pension of the basics, Pn Alice is En Numi's wife responsible for the lascial management of the use of them we hadden of voed dat Cenification Kolej Komuniti Mare Hajah Nidh s the one of the rope who has wide experiences in poder vies types of food stalak The company starts a firareng application to the bank and you are responsible to evaluate the vichlity of the basi la pertemang the credeat, youeaded by the secondit bis with example, the meaning of capital and condition evaluation under the of cred chi by Esplan THREE (3) differences between the Central Credit Rektance Information System (CCRIS Red CTOS Report mark Explore CCRIS report and CTOS repertcan assist you in evleting the date of the Tip THREE (3) schniques that can be cuced to mitigate crederick this marks (c) Assume that the bank has approved the following financing to Chicks Sdn. Bhd. and full disbursement was made on 10 July 2016.. No Type of Financing Purchase Price Market Value Financing Rate(%) Financing Tenure Amount (RM) 1,500,000.00 15 years 800,000.00 15 years 1 Land 3.0% 2.000.000.00 1.000.000.00 2 3.5% 3. Factory building Machineries Vehicle Total 550,000.00 400,000.00 950,000.00 3.000.000.00 4 500,000.00 7 years 300,000.00 9 years 3.100.000,00 3.5% 4.0% The company started its operations at the factory with new machineries at the end of January 2015 and recorded a 70% increase in sales for financial year ended 31 December 2015. The performance remains consistent in year 2016 and the company has been prompted in servicing monthly instalment (1) Suggest ONE (1) type of collateral can be taken by the bank to secure each of the above financing. Calculate collateral value for each of the financing (16 marks) However, the financial performance starts deteriorating in the second quarter of year 2017. Even though the company recorded consistent sales during the financial year ended 31 December 2017, the company suffered a significant reduction of 60% in their net profit Based on your analysis, the raw materials cost significantly increase due to the high exchange rate of Ringgit Malaysia, while the selling price remained the same. The company experienced very tight cash flow to oblige the financing monthly instalment. (2) Based on the above, evaluate the company's condition and formulate the suitable recovery plan. Support your recovery plan with THREE (3) justifications. (15 marks) In the fourth quarter of the year 2017, the bank officer detected few waming signals during the credit review. The CEO of the company is uncontactable. At the same time, the company has submitted three (3) requests to change the financing terms. As of November 2017, the company failed to submit its audited accounts for financial year ended 31 December 2016 despite several reminders sent by the bank to the company. As at 31 November 2017, the company has not paid monthly instalment for the factory and machineries for four (4) months. The site visit was conducted and it was found that the factory was not in operation. Based on the conversation with the workers of the next door factory, the factory has been closed for almost one month. Based on the above- (h) Suggest how the bank can get the fastest recovery from all the collateral taken to secure the financing in question (1) above. (4 marks) (1) Assume that the collateral value in (h) is not sufficient to cover the outstanding balance of the financing. Advise the suitable credit recovery plan in this situation. (4 marks) C) Identify and explain all important documents needed in credit recovery plan suggested in (1) above (8 marks) Total: 80 marks Click Sdn Bhd is a manufac company that produces from food producte inchading chicken popcoemugge chicken wings and chicken fingers with Chickeband. It red operation as a home used product in the year 2014 and das high demand, tesness Beds to expand their business typing medium sed factory with cestrale che increase the prodati pery. The business is a family business and the ship and most recen follows: Ne Names Ape Slaars) in Anh CEO Lineral Investment Dirone Account RM 350,000.00 ated with Mumat Malaysia the Ons were bouse located in Kajang with market value RMS 1 P A 30 Drew Chwns Public Listed Company Slures in KESE RM 270.000.000 3 Hi Aishah 59 30 ONS ASB rest of RM 2000 Ex Nami is the sea Aishah and he is the key person who is responsible for the prechte und daily pension of the basics, Pn Alice is En Numi's wife responsible for the lascial management of the use of them we hadden of voed dat Cenification Kolej Komuniti Mare Hajah Nidh s the one of the rope who has wide experiences in poder vies types of food stalak The company starts a firareng application to the bank and you are responsible to evaluate the vichlity of the basi la pertemang the credeat, youeaded by the secondit bis with example, the meaning of capital and condition evaluation under the of cred chi by Esplan THREE (3) differences between the Central Credit Rektance Information System (CCRIS Red CTOS Report mark Explore CCRIS report and CTOS repertcan assist you in evleting the date of the Tip THREE (3) schniques that can be cuced to mitigate crederick this marks