Advertising

Debt covenants

• Debt covenants spell out the details of the debt contract. For instance, the level and the timing of the promised interest rate and principal payments are explicitly stated. The covenants restrict the ability of the borrower to increase the risk of the firm after debt is taken on, or drain the assets of the firm. They are also designed to provide early warning signals if the health of the firm begins to weaken.

 
 

Follow this link for all the terms related to debt.

 
 Embedded terms in definition
 Assets
Contract
Covenants
Debt
Firm
Interest rate
Interest
Out
Principal
Risk
 
 Related Terms
 

<< Debt capital Debt displacement >>

Ways to Cope Financially During and After a Big Change: Here are suggestions for staying focused and avoiding costly decisions during changing times. More...

Who controls the past controls the future. Who controls the present controls the past. -George Orwell

Advertising



Copyright 2009-2018 GVC. All rights reserved.