Extraordinary Genius - Chapter 156 - Loans
ICBC’s bank Manager Zhu finally got to meet Feng Yu today. When they met, he immediately asked if Feng Yu was going to switch his company account to other banks.
Feng Yu explained that the company was making some investments, that’s why he had transferred some of his funds to other banks. His company account will still be with ICBC. There will not be any changes.
This assured Manager Zhu. He was at a critical stage. There were huge amounts of foreign currencies transactions with Tai Hua Trading account, and this was an achievement for him.
But relying on this achievement was not enough. Now the government had lowered the lending rate to increase spending. So, the banks need to switch their focuses from savings to lending.
Manager Zhu was leading regarding getting savings for the bank, and his branch was number one in the province. But regarding lending, Manager Zhu was not performing well. His branch was ranked below average in the region. This would affect his promotion to the post of Provincial Deputy Bank Manager.
Manager Zhu had wanted to talk to Feng Yu about loans, but Feng Yu brought up this subject after his explanations. He asked about the procedures for getting loans.
No choice. Feng Yu could not remember the procedures of getting a loan in this era, but he knew it was quite troublesome.
Manager Zhu’s eyes sparkles. Tai Hua Trading needs a loan? That’s great. I will approve whatever the amount as long as it was within his authority!
Manager Zhu even wishes for Feng Yu to get a loan for an astronomical amount. With the capabilities of Tai Hua Trading, he was not afraid that Feng Yu could not repay the loan.
Feng Yu saw the excitement in Manager Zhu’s eyes when they talked about getting a loan and understood why. The government was encouraging borrowing and spending. So, there should be a target for ICBC to hit.
Feng Yu wanted to get a loan for a large amount and invest in the stock market. This would save him a lot of trouble after two years.
“Manager Zhu, based on the financial situation of my company, there was no need to get a loan. But recently, my company have a big project. So, we might need to get a short-term loan. How is the interest calculated, the repayment period and the mode of repayment?”
Manager Zhu enthusiastically explained to Feng Yu. The interest would be the lowest, and he guaranteed it to be the lowest in the province. The repayment period would be 3 years, and the first and second year will be interest repayment only. The loan amount plus interest for the third year will be paid in the final year. This way, there will be no pressure on Feng Yu.
Feng Yu was jumping with joy in his heart. The was what he wanted. Although he still had the profits from the humidifiers and the annual returns from the Machinery Factory, he does not want to repay the loan early. 3 years was the right duration. His shares should be sold by then, and he should recover his investment.
“Manager Zhu, how much can your bank lend my company?”
“if you are using your shares in the Machinery Company as collateral, I can give you a loan of 1.2 million RMB. If it was Tai Hua Trading’s assets and income, I could lend you 10 million RMB. Wind and Rain logistics will be 2 million RMB, and the pig farm can get a loan of 500,000 RMB.” Manager Zhu was hoping for Feng Yu to use all these companies as collaterals for loans!
“Manager Zhu, this is not right. The market value of the Machinery Company shares is currently worth about 1.2 million RMB, and the loan amount you tell me is not making sense. Furthermore, why is Tai Hua Trading only worth 10 million RMB? Tai Hua Trading owns Wind and Rain brand, and there were over a few million Rubles of trade with the Soviet Union every month. Why is the loan amount so little?”
Manager Zhu stared at Feng Yu with eyes opened wide. Feng Yu wanted to borrow more? This was great! Since he thinks that the loan amount was too little, then how much does he want?
“Manager Feng, then how much do you think its reasonable?”
“With the Machinery Company’s shares and Tai Hua Trading assets and income as collateral, I wish to get a loan of 40 million RMB. As for Wind and Rain Logistics, I think it is worth 4 million RMB. We have a fleet of 80 Gaz trucks. Don’t tell me that a truck is not worth 50,000 RMB?”
Hmmm…… although Feng Yu had bought the trucks at less than 50,000 RMB each, the trucks were worth this price now!
Manager Zhu did not say anything yet, but Li Shiqiang stared at Feng Yu in shocked. What’s going on? You want me to get a loan of 4 million RMB? This…… Isn’t this a bit risky? The interest for a year was also not a small sum!
Li Shiqiang already felt that using all his available funds to invest in shares was a risky move and now Feng Yu still want to get a loan? He can get a loan for himself, why did he drag him along? Fine. Li Shiqiang had agreed to get some loans, but Feng Yu did not tell him that the loan amount was so much. If he can’t repay the loan, the logistics company will belong to the bank.
Feng Yu secretly patted his brother-in-law’s leg, assuring him. Feng Yu had wanted to build a hospital for his sister, but it was his brother-in-law who volunteered for the task. Feng Yu asked him to expand his business aggressively, but he was scared of failing. With the speed of the logistics company’s development, it would take more than 5 years to fulfill his sister’s dream.
Investing in shares was different. The returns would reach a few folds within 2 years, and Li Shiqiang’s worth would be increased to tens of millions RMB. At that time, he would have no problems even if he set up a few hospitals!
Manager Zhu asked in shaking voice: “You want to take a loan of how much? 40 million?”
“it’s 44 million.”
Manager Zhu was breathing rapidly. Ha, ha, ha. It’s done. It’s finally done. It was time for his promotion. He was short of 15 million for his target this year. With these 44 million loans, he would achieve his target with excess. His branch would be ranked first in the province. If he was not promoted, who else would be eligible?
“Let me think of a way. 44 million RMB, right? No problem!” Although this amount was not according to the regulations, Manager Zhu decided to speak to his higher-ups. A 44 million loan would take care of the whole province’s target. He believed that his leaders would approve this loan!
Feng Yu saw that Manager Zhu was accommodative and he continued: “I still have an antique. It is a Ming Dynasty Xuande burner. It is a real treasure, and there are only a few of them in the world. A Hong Kong businessman once offered 8 million to buy it from me. I will not ask for more. I will use it as collateral for a 6 million loan. the total loan amount will be 50 million RMB!”
Seeeee ~ ~ ~
Manager Zhu was frowning and exhaling loudly. There was no precedent in this province for using an antique as collateral for loans.
Supposedly, anything that was valuable could be used as collateral for loans. But the price for antiques was hard to evaluate. Feng Yu claims that someone offered him 8 million, but there was also the possibility that the antique could not be sold for even 80,000 RMB.
“Manager Feng, using antique is a bit hard. There is no benchmark to gauge its value. It’s very hard to get approval.” Manager Zhu said with a troubled look.
Feng Yu glanced at Manager Zhu: “It’s very difficult? Never mind then. We will go to CCB for loans. My father knows Manager Liu from CCB loans department too. I think with me using so many assets as collateral, it should not be difficult to get a 50 million loan.”
Manager Zhu watched Feng Yu stand up, and he immediately grabbed him by his hand.: “Manager Feng, please wait. We had cooperated for so long, and you still don’t trust me? Let me make a phone call first. Just a call.”
This was all for his merit, for his promotion!
Manager Zhu walked out of the room, and Li Shiqiang immediately asked: “Xiao Yu, why do you need to borrow so much money? What if you can’t repay?”
Feng Yu looked at Li Shiqiang confidently: “Brother-in-law, don’t worry. I can definitely repay this amount. Do you know how much profits from the overseas market did Tai Hua Trading get for the humidifiers? 10 million. 10 million USD! Next year, the profits will increase further. So, you don’t need to worry about the repayment. What we are doing now is seizing the opportunity to buy up all available shares in the market. You can see the returns at the end of this year. Maybe it might be even earlier than that. Maybe in October, you can see the profits!”
By sweeping 2 cities clean of the available shares, Feng Yu would affect the stock market and push up the prices!
Li Shiqiang wanted to say something, but Manager Zhu returned and told Feng Yu excitedly: “50 million RMB. Our city ICBC and the Provincial ICBC will jointly lend this amount to you!”