Q139
Restructuring of debts refers to
A.
Swapping less interest loans with more interest loans
B.
Modification of the terms of a loan to debtor who could default on payments
AnswerC.
Closing all outstanding loans
D.
Going for more and more borrowings
Answer: Option B
Solution
Answer: Option B
Solution:
Debt restructuring refers to modification of the terms of a loan to provide relief to a debtor who could otherwise default on payments. The restructuring may involve extending the period of repayment, reducing the total amount owed, or exchanging a portion of the debt for equity in the debtor company. Also see extension, composition, debt-for-equity swap.