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

  • SECTOR IN-DEPTH
    13 Apr 2021|Moody's Investors Service
    First quarter 2021 CQ score improves modestly. The average covenant quality (CQ) score for Asian full-package high-yield bonds improved by 3% in Q1 2021 to 3.54 (weak ↑) from an all-time weakest quarterly score of 3.63 (weak) in the previous quarter.

    SECTOR IN-DEPTH
    11 Feb 2021|Moody's Investors Service
    The LCQI stayed flat at 4.11 (weak level protection) in the third quarter of 2020 because of low issuance, but volume in 2021 is set to increase.

    SECTOR IN-DEPTH
    25 Jan 2021|Moody's Investors Service
    The average covenant quality (CQ) score for Asian fullpackage high-yield bonds in Q4 2020 weakened to 3.63 (weak), a new all-time weakest quarterly score, from 3.48 (weak ↑) in Q3 2020.
    SECTOR COMMENT
    29 Sep 2020|Moody's Investors Service
    Ba-rated full-package1 bonds issued by Chinese property and Chinese industrials companies have weaker covenant quality (CQ) scores than their respective B-rated bonds, reflecting that Ba-rated bonds feature weaker covenants.

    SECTOR IN-DEPTH
    17 Dec 2020|Moody's Investors Service
     The CQI improved to 4.41 (weakest) in November from 4.44 (weakest) in October and 4.50 (weakest) in September. But the indicator remains above 4.40 for a record 19th consecutive month.

    SECTOR COMMENT
    17 Nov 2020|Moody's Investors Service
    Eroded credit protections, including covenants, enable distressed borrowers to incur debt on terms detrimental to existing investors, making litigation and brinkmanship more likely.

    SECTOR IN-DEPTH
    27 Oct 2020|Moody's Investors Service
    The LCQI showed only minimal improvement from last quarter's record-weakest measure, despite the near-complete shutdown of the loan markets.

    SECTOR IN-DEPTH
    05 Oct 2020|Moody's Investors Service
    The average covenant quality score for full-package EM bonds issued during the 6 months to 30 September 2020 worsened to 3.45 (weak ↑) from 3.25 (moderate ↓) for the previous 6 months.
     

    SECTOR IN-DEPTH
    21 Sep 2020|Moody's Investors Service
     More Chinese property developers are preserving their debt incurrence capacity by using more easily satisfied debt incurrence tests and larger debt carve-outs for their bonds issued in 2020.

    SECTOR IN-DEPTH
    21 Jul 2020|Moody's Investors Service
    The surge indicates that borrowers are exhausting their covenant cushions and are worried about breaching their maintenance covenants. Many were facing liquidity pressure before the crisis.
    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