Aston Martin may be in deeper financial trouble than the company is stating publically. The automaker's chair says the firm may be in danger of defaulting on their bank loans.

Aston Martin may violate terms of their banking deals later this year, according to the company's chairman. Aston head David Richards said that although the company has no imminent financial troubles, they may technically breach their bank covenants.

Breaching a loan covenant could be considered a default, triggering a bank's right to demand the full and immediate payment of a loan. If Aston Martin cannot afford the bill, they could declare bankruptcy. Some common terms included in a loan could dictate the company's liquidity and its profitability.

Richards says the current financial crisis is to blame for the situation. Despite saying Aston Martin can weather the storm, Richards' company cut 600 jobs and slowed down manufacturing to match a much decreased demand. Research and development has also been stalled at the firm.

A group of investors, backed by financiers in Kuwait, purchased Aston Martin from Ford for £479 million in 2007. The current situation means the investment team may have to pump more cash in the business to keep it afloat. This comes at a bad time for one of the backers, Investment Dar, which says they need £680 million to refinance short-term debt.

Investment Dar executive vice-president Amr Abou El-Seoud is considering selling up to 20% of the British automaker.

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