Net worth: Difference between revisions
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1. | 1. ''Loan documentation''. | ||
''Loan documentation''. | |||
Broadly, Net worth is the value of equity, based on book values, which a borrower covenants to maintain at a minimum absolute or relative level (for the protection of the position of the lender). | Broadly, Net worth is the value of equity, based on book values, which a borrower covenants to maintain at a minimum absolute or relative level (for the protection of the position of the lender). | ||
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== See also == | == See also == | ||
* [[Assets]] | |||
* [[Covenant]] | * [[Covenant]] | ||
* [[Equity]] | |||
* [[High net worth]] | * [[High net worth]] | ||
* [[Liabilities]] | |||
* [[Tangible net worth]] | * [[Tangible net worth]] | ||
* [[Wealth management]] | * [[Wealth management]] | ||
Revision as of 12:40, 4 August 2019
1. Loan documentation.
Broadly, Net worth is the value of equity, based on book values, which a borrower covenants to maintain at a minimum absolute or relative level (for the protection of the position of the lender).
The definition of Net worth for covenant compliance purposes will often be a point of negotiation between the lender and the borrower.
For example, Tangible net worth excludes intangible fixed assets from the total figure.
2.
A comparable measure for an individual, often in the context of assessing 'high net worth' in the context of wealth management services.
