When most entrepreneurs start or expand a business, they apply for loans. The bank reasonably requests collateral, including firm assets, such as property or (heaven help us) cash. A Spanish bank has offered a unique form of collateral in its loan request. According to presseurop, the Bankia group of savings banks has posted the contracts of Real Madrid soccer stars Cristiano Ronaldo (photo, left side) and Kaka (photo, right side) as collateral. That's right: human beings are now the stuff of loan guarantees. While the use of human collateral has a long, unpleasant history, one doesn't expect its acceptance in contemporary, sophisticated business transactions. There are exceptions, notably in the entertainment business. However, perhaps bankers could start a new business trend and put themselves up as collateral. Then one could learn their true "free market" value. Then again, the bankers might not want to know.Thursday, July 28, 2011
Spanish Bank Uses Cristiano Ronaldo and Kaka Contracts as Financial Collateral
When most entrepreneurs start or expand a business, they apply for loans. The bank reasonably requests collateral, including firm assets, such as property or (heaven help us) cash. A Spanish bank has offered a unique form of collateral in its loan request. According to presseurop, the Bankia group of savings banks has posted the contracts of Real Madrid soccer stars Cristiano Ronaldo (photo, left side) and Kaka (photo, right side) as collateral. That's right: human beings are now the stuff of loan guarantees. While the use of human collateral has a long, unpleasant history, one doesn't expect its acceptance in contemporary, sophisticated business transactions. There are exceptions, notably in the entertainment business. However, perhaps bankers could start a new business trend and put themselves up as collateral. Then one could learn their true "free market" value. Then again, the bankers might not want to know.
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