Asset Coverage Ratio

Asset Coverage Ratio

The ratio of the value of a company's assets less current liabilities to the company's total debt outstanding. These liabilities may include preferred dividends and rent. The asset coverage ratio measures how easily a company can maintain its operations with its level of debt. See also: Cash flow coverage ratio, Debt service coverage ratio.
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Finally, the company mentioned that borrowings under the credit facility are subject to different covenants such as the leverage restrictions contained in the Investment Company Act of 1940, as amended, as long as the company's asset coverage ratio under the credit facility is not less than 150%.
He added that the asset coverage ratio requirement had been officially lowered in June, giving the company significant flexibility to increase leverage and grow its portfolio.
The asset coverage ratio of the reorganized fund, as calculated in accordance with the Fitch total and net overcollateralization tests (Fitch OC tests), per the 'AA' rating guidelines for the MRPS, outlined in Fitch's closed-end fund criteria, were in excess of 100%.
In connection with the Special Meeting, the company plans to file with the SEC and mail to its stockholders a proxy statement that will provide additional detail regarding the company's rationale for adopting the reduced asset coverage ratio requirements.
If the Company's voting shareholders approve the proposal by the required majority of votes at its 2018 Annual Meeting of Shareholders, the 150% asset coverage ratio will become effective on the day after such approval.
EADB has one of the highest asset coverage ratio (Usable Equity / (Gross Loans + Equity + Expected Loss on Liquid Assets) in Moody's MDB rating universe at 120.2 per cent in 2016.
The most controversial aspect of the bill is that it would increase a BDC's ability to deploy capital to businesses by reducing its asset coverage ratio, or required ratio of assets to debt, from 200% to 150% if certain requirements are met.
The bank continued to maintain a conservative policy of non-performing asset recognition by taking additional Dh625.6 million in total credit provisions, to ensure a healthy pre-collateral non-performing asset coverage ratio of 83.2 per cent of the total non-performing portfolio, net of write-offs.
Maintaining a conservative policy of non-performing asset recognition and remedial management, including taking an additional Dh159.8 million in total credit provisions, to ensure a healthy pre-collateral non-performing asset coverage ratio of 82.2 per cent of the impaired portfolio, net of write-offs.
The asset coverage ratio of customer rating reached over 75% and the debt rating covered over 170 business types.
To sum up, as it is confirmed by the F-test statistics, the main explanatory variables of the profitability of the real estate companies were the fixed asset turnover, the return on sales and the level of fixed assets and debt (included into the asset coverage ratio), all of them provided by an expansive economic cycle characterized by a high level of sales and a high leverage of the companies.