What is Debt Restructuring

Debt Restructuring is the word which you often hear when economy is not doing well and there is slow growth in an economy. Debt restructuring in simple word means is a process by which the company which is under debt modifies or change the terms of the debt so that the imminent default is averted and the company gets more time to repay the debt.

Debt restructuring can be done in many ways like company may ask the bank or financial institution to reduce the rate of interest, or swap equity in place of debt and so on. The banks also prefer this because in some cases it is better to give more time to a company than writing off that account as non-performing or bankrupt.


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