North American Bond Covenant Quality Indicator: CQI achieves best score since 2019 as low-rated bonds continue to dominate
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.
Leveraged Loan Covenants - North America: A decade of loosening credit protections forces creditors to compromise or fight
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.
North American Loan Covenant Quality Indicator: Covenants barely budged even as the loan market ground to a temporary halt
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.
Emerging Markets Covenant Monitor: Emerging Markets covenant quality scores reach all-time worst level amid slowing issuance
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.
01 Oct 2020|Moody's Investors Service
The average covenant quality score for Asian high-yield bonds in the third quarter of 2020 was 3.48 (weak ↑).
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.
High-yield bond covenants — China: Chinese property developers loosen debt covenants in 2020 amid pandemic
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.
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.