Repo-to-maturity and Springing covenant: Difference between pages
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imported>Doug Williamson (Created page with "''Off balance sheet risk - repurchase agreements''. (RTM). A repo-to-maturity transaction is a repurchase agreement in which the transferred securities (usually government b...") |
imported>Doug Williamson (Define 'lite' covenants.) |
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'' | ''Long term funding''. | ||
( | A covenant in a loan agreement which becomes effective on the occurrence of a certain event in the future. Used to enable loan agreements to have fewer and less onerous ('lite') covenants, typically to conform to other loans of the same borrower. | ||
A | A common springing event is the level of utilisation of a loan facility at which time covenants such as ICR ([[interest cover]] ratio) and [[gearing]] come into effect. | ||
Springing covenants are a form of [[contingent covenant]]. | |||
== See also == | |||
*[[Incurrence covenant]] | |||
*[[Maintenance covenant]] | |||
[[Category:Long_term_funding]] | |||
Revision as of 15:15, 1 August 2015
Long term funding.
A covenant in a loan agreement which becomes effective on the occurrence of a certain event in the future. Used to enable loan agreements to have fewer and less onerous ('lite') covenants, typically to conform to other loans of the same borrower.
A common springing event is the level of utilisation of a loan facility at which time covenants such as ICR (interest cover ratio) and gearing come into effect.
Springing covenants are a form of contingent covenant.
