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Debt covenant

This topic has 1 reply, 2 voices, and was last updated 1 year ago by Stephen Widberg.

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May 28, 2021 at 7:51 pm #622088
nk16
Participant
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Can plz brief me on debt covenant what are this am confused
May 29, 2021 at 5:41 pm #622210
Stephen Widberg
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When a company borrows money from the bank, it makes certain promises – known as covenants. Normal covenants would be:
1. Gearing will not be more than x%.
2. Current ratio will not be less than x times.
Etc.
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