Covenants
This page aggregates all research regarding covenants published by Moody's Investors Service.
  • SUMMARY
  • REPORTS

  • SECTOR IN-DEPTH
    30 Jun 2020|Moody's Investors Service
     Speculative-grade companies have unprecedented flexibility to react to the current downturn without bondholder interference. Companies owned by private equity are particularly unfettered.

    SECTOR IN-DEPTH
    16 Jun 2020|Moody's Investors Service
    The CQI moved to 4.54 (weakest) in May from 4.53 (weakest) in April and 4.47 (weakest) in March, remaining above 4.40 for a record thirteenth consecutive month and in weakest-level territory for the seventeenth consecutive month.

    SECTOR IN-DEPTH
    20 May 2020|Moody's Investors Service
    While credit agreements lack stand-alone provisions to exercise remedies based solely on a material adverse effect, covenants requiring clean audited financial statements may fill the gap.

    SECTOR IN-DEPTH
    27 Apr 2020|Moody's Investors Service
    Just before the coronavirus pandemic grinded new loan issuance to a halt, the LCQI bottomed out at its weakest-ever level in the fourth quarter of 2019.

    SECTOR IN-DEPTH
    20 Apr 2020|Moody's Investors Service
    Covenant quality improvement during the six months that ended on 31 March 2020 signals a slight increase in bondholder protections, but the risk of cash leakage is rising. Covenant quality in emerging markets remains stronger than in North America and EMEA (excluding emerging market countries).

    SECTOR IN-DEPTH
    02 Apr 2020|Moody's Investors Service
    As debt may become more expensive and EBITDA deteriorates in a coronavirus-led downturn, Chinese property developers that lowered the fixed-charge coverage ratio (FCCR) threshold under their debt incurrence tests ($1 debt test) are better able to preserve capacity to incur debt.

    SECTOR IN-DEPTH
    08 Apr 2020|Moody's Investors Service
    Thanks to flexible debt incurrence covenants, PE-sponsored companies in distress can act quickly to access liquidity without notifying or compensating bondholders.
    SECTOR IN-DEPTH
    26 Mar 2020|Moody's Investors Service
    Leveraged loan documents do not provide institutional loan investors with the right to influence how borrowers respond to financial deterioration caused by the coronavirus. Maintenance covenants in revolving credits offer institutional loan investors
    some derivative protection.
    Bond Covenant Quality
    Bond Covenant Qualtiy Assessments
    Moody's Investors Service
    List of all Bond Covenant Quality Snapshots to date.
    Loan Covenant Quality
    Loan Covenant Quality Assessments
    Moody's Investors Service
    List of all Loan Covenant Quality Snapshots to date. 

    KEY CONTACTS
    Evan Friedman
    SVP – Head of Covenant Research
    Evan.Friedman@moodys.com
    Jake Avayou
    VP-Senior Covenant Officer
    Jake.Avayou@moodys.com
    Enam Hoque
    VP-Senior Covenant Officer
    Enam.Hoque@moodys.com
    Derek Gluckman
    VP - Senior Covenant Officer
    Derek.Gluckman@moodys.com
    Lisa Gundy
    VP - Senior Covenant Officer
    Lisa.Gundy@moodys.com