High LeverageA high debt-to-equity ratio indicates significant leverage that raises refinancing and solvency risk over time. If interest rates rise or funding tightens, debt servicing costs can compress margins and constrain new lending, weakening long-term financial flexibility.
Negative Cash FlowsPersistent negative operating and free cash flows signal limited internal cash generation, increasing dependence on external borrowings to fund growth. Over months this can stress liquidity, elevate funding costs, and force slower loan book expansion or higher provisioning.
Funding SensitivityReliance on external borrowings makes profitability sensitive to market interest rates and credit availability. Structural funding cost volatility can erode lending spreads and restrict scale, making long-term earnings and asset growth contingent on competitive access to low-cost capital.