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14 November, 03:21

Can a financial institution keep borrowers from engaging in risky activities if there are no restrictive covenants written into the loan agreement?

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  1. 14 November, 03:27
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    YES, financial institutions can keep borrowers from engaging in risky activities, even though there are no written restrictive covenant between the bank and the borrowers. The bank can do this by warning the borrowers that they will not be considered for future loans if the the present loan is not well managed.
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