Asset-Coverage Test

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Asset-coverage test

A bond indenture restriction that permits additional borrowing if the ratio of assets to debt does not fall below a specified minimum.

Asset-Coverage Test

A test determining whether a company is allowed to issue bonds. It is calculated by subtracting a company's current liabilities from its net assets and dividing the quantity by its total debts and/or preferred stock obligations; it may be expressed as dollar amount or as a percentage. Generally, a higher asset-coverage test is desirable, as it indicates the level of debt is low compared to net assets. A significant limitation of the asset-coverage test is the fact that it does not account for liquidity when making the calculation.

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No references found			Ongoing asset-coverage testing--The cover pool will need to be subject to a monthly asset-coverage test to ensure that the adjusted aggregate loan amount will be equal to or greater than the aggregate principal amount of the outstanding mortgage bonds, plus the 5 percent for overcollateralization. Covered bonds--a timely alternative: with the mortgage-backed ... by Klein, Bruce / Mortgage Banking The template provides a framework for market participants in such areas as eligible collateral, amount of collateral, asset-coverage tests and compliance. Hunt Continues For Way To End Credit Crunch by Gordon Platt / Global Finance			Asset Price Asset Pricing Model Asset Quality asset redeployment Asset Retirement Obligation Asset Sale Asset Share Value Asset Stripper Asset Stripping Asset Substitution Asset Substitution Problem Asset Sufficiency or Insufficiency Asset Swap Asset Turnover Asset Valuation Asset Valuation Reserve Asset Value Asset-Backed Alert Asset-Backed Bond Asset-Backed Commercial Paper Asset-Backed Fund Asset-Backed Security Asset-Based Finance Asset-Based Financing Asset-Conversion Loan Asset-Coverage Test Asset-Liability Committee Asset-Liability Gap Asset/Equity Ratio Asset/Liability Committee Asset/Liability Management Assets Assets and Valuation Assets Requirement Assets requirements Assets Under Management Assets-in-Place Assicurata aggiunta Assicurato Assicurazione Assicurazione contro sinistri Assicurazione generale Assicurazione sul carico Assicurazioni patrimoniali assign Assignable Contract Assigned Dealer Assigned Mailing Date Assigned Risk Assigned Risk Plan assignee			Asset, Liability, Owner's Equity, Revenue, Expense Asset, Service and Demand Management Asset, Wasting Asset, Wasting Asset-backed Asset-Backed Alert Asset-backed bond Asset-Backed Bonds Asset-Backed Commercial Paper Asset-Backed Commercial Paper asset-backed fund asset-backed fund Asset-Backed Funds Asset-Backed Funds Asset-Backed Insurance Lending Asset-backed securities Asset-backed security Asset-backed security Asset-backed security Asset-backed security Asset-backed security Asset-Based Community Development Institute Asset-based economy Asset-based economy Asset-Based Finance Asset-based financing Asset-based financing Asset-based lending Asset-Conversion Loan Asset-Conversion Loans Asset-Coverage Test Asset-Equity Ratio Asset-for-Asset Swap Asset-for-Asset Swaps Asset-Liability Committee Asset-Liability Committee Asset-Liability Gap Asset-Liability Gaps Asset-liability management Asset-Sensitive asset-stripper asset-stripper asset-strippers asset-strippers Asset-stripping Asset-stripping Asset-stripping Asset/equity ratio Asset/Liability Committee Asset/Liability Committee Asset/liability management Asset/Liability Management Committee Assetmanagement ASSETREP assets assets assets assets assets assets Assets and Liabilities

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