Sino Agro Food Inc (fka SIAF)

[RealUSA]

the low interest rate is indicative of hypothecation. the shares have been sold by the lender and they will have to buy back if the loan is paid. they technically still have the shares on their books.

they do these deals with a portfolio of weak companies because most of the time the companies fail and they don't have to buy back.

they don't have to buyback leaving unrealized profits no taxes and they book the loan as a loss for tax purposes.

the borrowing entity wins since they don't have to pay the loan back and got cash upfront for almost no interest. only losers are public shareholders.