Asset Coverage

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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.
References in periodicals archive ?
Aon Launches Intangible Asset Cover for Gig Economy Companies
Since the BSP was adopting the Basel 3 liquidity coverage ratio or LCR this year, it has scrapped banks' required liquid assets against a bank's holdings of government deposits and the liquid asset cover. The BSP also removed the currency cover requirement for FCDUs.
Unencumbered Asset Cover Falling: Unencumbered asset cover had fallen to 2.1x at YE17 from 2.3x at YE16 as a result of increased secured debt in joint ventures, following the secured debt issuance in the Dundrum Town Centre portfolio and additional secured debt at VIA outlets.
The financial performance was recorded on the back of a sustainable and prudent approach in long-term value creation, with Portfolio NWA growing at a compounded annual growth rate of 9.6 per cent per annum since May 14, 2004, and a portfolio asset cover of 3.1X realisable asset value of RM157.2 billion as at Dec 31, 2017.
Banks were generally compliant with the required asset and liquid asset cover ratios of 100 percent and 30 percent, respectively,' it added.
The waiver is said to be centred around the firm's asset cover covenants, which govern the ratio of debt to net assets, thought to be at 85 per cent.
Quoting a source close to the negotiations, Building said the waiver centred around the firm's asset cover covenants, which govern the ratio of debt to net assets.
The Committee also proposes that the management boards should include representatives of beneficiaries and suggests that the provisions of Article 16 concerning asset cover be extended to cross-border funds.
While other factors (such as interest cover, fixed asset cover and cash flow) may be relevant, the Revenue has principally focused on the debt to equity ratio.
Solid Asset Cover: Grainger's GBP275 million secured notes are rated a notch higher than the company's IDR to reflect above-average recovery expectations.
'The combination of this strong management team, attractive cashflows and good asset cover make this a very attractive deal for us and one that is well suited to our funding package.' Russell Leaker at Bank of Scotland Structured Finance, added: 'The Mezzanine team at Bank of Scotland are pleased to be co-investing alongside CBGC in a business with experienced management, a history of profitability, good growth prospects through de-regulation and the increasing possibility of sector consolidation in the future.'
Financial covenants include minimum asset cover, which for properties valued on EUV-SH will be 1.05x the amount on-lent, and for those properties valued at MV-stt, 1.15x.