With Article 9 provisions changing and inconsistencies among the codes of various jurisdictions, maintaining a secure position can be a complex responsibility. Bottom line, secure positions are the lifeblood to an asset-based lender and an understanding of changing regulation is critical to success.
To conclude her three-part series intended to de-mystify the workout banker’s motivations, Kristina Anderson of Carl Marks Advisory Group examines some of the dynamics inside senior lender syndicates and how those dynamics affect the syndicate’s ability to respond in workout and default situations. As Anderson notes, distress doesn’t necessarily have to lead to war.
Loan economics are just one of many factors influencing the workout banker’s decisions in the complex arena known as commercial bank workouts. Workout bankers in many commercial banks manage risk, not just loans. Kristina Anderson continues her discussion on de-mystifying the workout banker’s motivations.
In Part I of this two-part article, Ken Naglewski of Seabiscuit Partners, opined that a chief restructuring officer (CRO) needs to be at least equally adept at behavioral psychology as she or he is in restructuring and turnaround strategies and tactics and be politically astute. In Part II, the author examines further the difficulties encountered in restructuring situations caused by the realities of organizational dynamics and human behavior, and provides some tactics that have proven successful in distressed situations.
In Part I of this article, Ken Naglewski of Seabiscuit Partners examines classical turnaround theory and practice in relation to the realities of organizational dynamics and the behavioral aspects of the players in a distressed debt situation. The author opines on the necessity of a CRO assessing the political realities of each situation and developing a political style and game plan that has the best chance to be successful in a particular situation. In Part II of this article, the author reinforces the importance of dealing with political realities of distressed debt situations, provides some examples from real situations and potential strategies for dealing with different situations.
The pace of technological change has been rapid for the past generation, but it is only in looking back that one can begin to perceive broader trends in what has seemed to many to be a deluge of tools, gadgets and relentless complexity. While this generation of unrelenting technological progress has paid numerous dividends, it also represents considerable peril, especially for companies in distress. The operations of companies are becoming increasingly data-centric and so must successful turnarounds.
With more than 9,600 members and counting, a growing international constituency and a myriad of educational and networking initiatives in various stages of development and implementation, the Turnaround Management Association finds itself expanding on every conceivable front. And at the tender age of 22, the association does whatever it takes to keep tuned to the ever-evolving needs of its members.
Asset-based lending and leveraged financing have reappeared in a way that was unimaginable a year ago. Suddenly in Q4/09, it was as though a switch was thrown. Trimingham directors Hugh Larratt-Smith and Joseph Vuckovich speak to several lenders on what makes for financing a successful turnaround.
Lenders in the dairy industry are accustomed to volatility. As long as the volatility in inputs and outputs was moving in tandem, lenders could expect their borrowers to achieve some minimal “guaranteed” margins and debt service remained possible. However, that changed beginning in 2007…
Under any scenario, the loss of trust in a customer’s ability or desire to operate its own business effectively can be one of the most difficult challenges facing a lender and can feel like the weight of cement shoes to both the lender and customer alike. But bringing in a trusted, experienced, independent third party as either a CRO or receiver can immediately lift that weight and allow the company to walk straight to whatever the appropriate goal line may be.