Covenant: Difference between revisions
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1.A formal legal agreement to take, or not to take, certain actions. | 1. A formal legal agreement to take, or not to take, certain actions. | ||
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==Other links== | ==Other links== | ||
[http://www.treasurers.org/node/5225 Loan agreement covenant performance, Will Spinney, ACT 2009] | [http://www.treasurers.org/node/5225 Loan agreement covenant performance, Will Spinney, ACT 2009] | ||
[[Category:Bank_Lending]] | |||
[[Category:Debt_Capital_Markets]] | |||
[[Category:Legal_Documentation]] | |||
[[Category:Managing_Risk]] | |||
Revision as of 06:15, 4 October 2013
1. A formal legal agreement to take, or not to take, certain actions.
2. In loan documentation, a promise given by the borrower to take, or not to take, relevant actions.[1] For example, a financial covenant to maintain a minimum ratio of net worth to debt.
3. In relation to pension funds, the credit strength of the sponsoring employer and its commitment to the pension fund.
See also
- Accounting exposure
- Asset cover
- Event of default
- Financial covenant
- Incurrence covenant
- Interest cover
- Loan agreement
- Maintenance covenant
- Net worth
- Restrictive covenant
- Waiver
References
Treasury Essentials: Covenants, The Treasurer, March 2013
