Case Study: Loan Commitment for BSH Ship Company BSH Company is a company in an emerging market. It mainly makes large ships of size 10,000 tons to 100,000 tons, the following is the summary of the operating income of this company from 2011 to 2013, 2011 2012 2013 Ships ordered 8 12 21 Ships finished 4 7 11 Sales ($million) 65 87 130 Net profit ($million) 5.4 6.5 8.7 Net operating income ($million) -0.4 -1.1 -1.4 The balance-sheet of BSH company in 2013 is as follows (in millions of dollars), Current assets 125 Current liabilities 80 Inventory 85 Short-term debts 35 Account receivable 25 Account payable 27 Other 15 Other 18 Fixed assets 80 Long-term Liabilities 30 Other assets 5 Equity 100 Total assets 210 Liability and Equity 210 Recently, BSH Company would like to investment $5 million to build a new shipyard. Now BSH Company asks for a loan commitment of 3 years in amount of $2 million from UOY bank. As the credit officer in the UOY bank, will you approve this application? Why or why not?