| 单词 | under-capitalized |
| 释义 | under-capitalized Having too little capital in relation to the business carried on or intended. If a business has insufficient capital, it is liable to become insolvent too easily in the face of the risks normal in its line of activity, such as delays in payment by customers. It is risky to lend or extent credit to an under-capitalized business, and being charged premium rates or refused credit is bad for its profits. For most businesses, under-capitalization is discouraged simply by being unprofitable, but in the case of banks and other financial institutions there is public regulation of capital adequacy, because of fears that the insolvency of one institution could cause a general financial panic. |
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