I recognize that the below idea may be overly complex to implement in gameplay but I think it would improve the balance of the banking DLC.
When issuing bonds I think that having the option to post collateral to lower the required interest rate would be a nice feature. For example, if I were to issue a $20 million 5 year bond and put up an apartment of equal or greater value as collateral in exchange for a 100 - 200 basis point reduction in interest rates that would allow for a more robust lending system. In situations of default, bondholders would receive the asset (in this case the apartment). If multiple companies own bonds during a default, the largest holder could be required to buy the proportion of the asset from other debt holders at market value of the property. For bonds that do not have specific companies holding them, the collateral could just be removed from the map under an implied liquidation, allowing the debt to be settled by the assets pledged. Under this system I think most business assets could be used as collateral (although not banks and insurance companies).
The reason I put forth this suggestion is that bond ratings can significantly deteriorate when there is a decline in equity value of the issuer, even when tangible book value exceeds the value of equity. Under some recessions it is possible to have a company with a $300 million real estate portfolio, $100 million of debt, and $180 million value of stock. The frequency of companies trading below book value feels a little broken in present gameplay, particularly when the companies are profitable. By lowering the cost of borrowing for highly levered companies, the prevalence of companies trading below book value would be lower. Also, collateral lending allows an option to pursue more rapid expansion although a misstep results in losing the business assets.
Interested to hear feedback and thoughts from you.