CG65952 - Losses: loans to traders: irrecoverability: borrower continues to trade

There may, exceptionally, be no reasonable prospect of recovery of a loan even though the borrower continues to trade. Any judgement as to whether there was any reasonable prospect of recovery will depend on the precise circumstances of each case. In marginal cases, it will be necessary to obtain details of any judgements which were made concerning the borrower’s future prospects, at or about the time the loan is claimed to have become irrecoverable. You will also need to form an opinion on the factual basis for those judgements, and you may need to consider carefully the circumstantial evidence including all available documentation such as material presented to bankers or other investors, and, in the case of companies, relevant directors’ reports.