Asset Coverage

Asset Coverage

The extent to which a company can maintain operations at its level of debt. One of the most common ways to measure asset coverage is the asset coverage ratio, which divides the value of tangible assets less current liabilities by the company's total debt outstanding. These liabilities may include preferred dividends and rent. See also: Cash flow coverage ratio, Debt service coverage ratio.
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Sufficient asset coverage relative to Fitch's published criteria;
Based in Naperville, IL, United Asset Coverage is the nation's leading provider of maintenance coverage for telecommunications and office equipment, offering clients more vendor choice and lower costs.
As of the same date, the fund's asset coverage ratios, as calculated in accordance with the Fitch total and net overcollateralization tests (Fitch OC Tests) per the 'AAA' rating guidelines outlined in Fitch's applicable criteria, were in excess of 100%, which is the minimum asset coverage amount deemed consistent with an 'AAA' rating.
5 million auction rate issue is based on the fund's investment guidelines, the discount factors required to determine eligible asset coverage, and either the maintenance of 225 percent minimum asset to liability coverage or the application of more conservative discount factors in determining eligible asset coverage for the fund's preferred stock investments.
KEY RATING DRIVERS --Sufficient asset coverage relative to Fitch's published criteria; --The structural protections afforded by mandatory de-leveraging provisions in the event of asset coverage declines; --The equal (pari passu) treatment in point of priority and security with the secured financing facilities of the fund; --The legal and regulatory parameters that govern the fund's operations; --The capabilities of LMPFA and ClearBridge as investment advisor and subadvisor.
The 'AAA' long-term rating primarily reflects: --Sufficient asset coverage provided to the VRDP shares as calculated per the fund's overcollateralization (OC) tests; --The structural protections afforded by mandatory de-leveraging provisions in the event of asset coverage declines; --The legal and regulatory parameters that govern the fund's operations; --Both the short- and long-term ratings also reflect the capabilities of NFA as investment advisor and NAM as subadvisor.
4, 2013, the fund's asset coverage ratios, as calculated in accordance with the Fitch total and net overcollateralization tests (Fitch OC tests) per the 'AAA' rating guidelines outlined in Fitch's applicable criteria, were in excess of 100%, which is the minimum asset coverage amount deemed consistent with an 'AAA' rating.
At the time of the rating affirmation, the fund's asset coverage ratio for preferred stock, as calculated in accordance with the Investment Company Act of 1940 (1940 Act), was in excess of 200%, which is the minimum asset coverage required by the 1940 Act.
Should the asset coverage tests of the AMPS decline below their minimum threshold amounts (as tested on the last business day of each week) and are not cured within a pre-specified timeframe of six business days, the governing documents require the fund to reduce the leverage in a sufficient amount to restore compliance with the applicable asset coverage tests within a specified timeframe.
The 'AAA' ratings assigned to the VMTP Shares and AMPS are based on asset coverage provided to each series of preferred shares by the funds' portfolios, structural protections afforded by mandatory deleveraging provisions in the event of asset coverage declines, the legal and regulatory parameters that govern the funds' operations and the capabilities of Federated as investment advisor.
Fitch's latest analysis also indicates that New Jersey, New York, and Connecticut single-state funds' preferred shareholders continue to benefit from healthy asset coverage cushions as a protection against the possibility of any near-term price volatility associated with the storm.
Sufficient asset coverage provided to the VRTP Shares as calculated per the fund's asset coverage tests;