debt restructuring


Also found in: Wikipedia.

Debt restructuring

Modification of the terms of a loan to provide relief to a debtor who could otherwise default on payments. The restructuring may involve extending the period of repayment, reducing the total amount owed, or exchanging a portion of the debt for equity in the debtor company. Also see extension, composition, debt-for-equity swap.

Debt Restructuring

The process of a person or business negotiating and agreeing with its creditors to reduce its debt or to revise a repayment plan. Debt restructuring often occurs when a person or company has taken on too much debt and is in danger of bankruptcy. Debt restructuring is beneficial to the person or company requesting it because it often results in a significant discount and/or a more flexible repayment schedule. It is usually less expensive than a bankruptcy would be. Likewise, it is beneficial to the creditors because a bankruptcy will likely result in some debt being discharged; creditors generally prefer debt restructuring because they would rather be paid less than not paid at all. See also: debt-to-equity swap, restructuring, capital structure.

debt restructuring

An exchange of one or more new debt issues for outstanding debt issues that can occur when the new issues have interest rates and/or maturities that differ from those of the outstanding issues. For example, a firm might offer holders of 9% coupon bonds with 5 years to maturity a new bond with a higher-coupon rate and a 25-year maturity. Creditors having difficulty making interest and/or principal payments often restructure their debt to reduce the size of the interest payments and to extend debt maturity. Also called troubled debt restructuring. Compare restructuring.
References in periodicals archive ?
operations after so far failing to find an acquirer or reach a debt restructuring agreement with lenders, Bloomberg reports, citing people familiar with the matter.
The opening ceremony was sponsored by Ali bin Hamdan al- Raisi,Deputy Executive President of the Central Bank of Oman, who stressed the importance of debt restructuring and its handling at the moment according to the new approaches that allow the creditor bank to reduce its losses and creating additional provisions to cover its existing debits, in addition to providing protection for the banks to face the toughest possible conditions faced by some borrowers who enter the restructuring of long-term procedures and allow the debtor to resume its activity.
The confirmed rating is a direct and positive acknowledgement of the results of foreign debt restructuring successfully completed by Ukraine on November 12 of the current year by the emission of new bonds.
NEW YORK (CyHAN)- The General Assembly today (10 Sept) approved a resolution on sovereign debt restructuring in response to Argentina's "vulture funds" crisis and growing concerns about sovereign debt problems elsewhere.
Global Banking News-June 9, 2015--Indian central bank issues new rules for banks on debt restructuring
10 (Petra)- Jordan voted late Tuesday in favor of the UN General Assembly resolution on sovereign debt restructuring to improve the global financial system.
The European Commission on Thursday rejected the International Monetary Fund's view that lenders mishandled the first Greek bailout in 2010 by allowing Athens to delay a debt restructuring to 2012.
Summary: DUBAI -- The real estate developer Nakheel on Tuesday announced that it paid an additional Dh206 million to its creditors as part of its debt restructuring.
350 billion textile sector debt restructuring package.
3 April 2012 - Italian broadcaster Mediaset SpA (BIT:MS) announced in a statement on Tuesday a full exit from Dutch TV producer Endemol which was taken over by creditors following a debt restructuring deal.
It said Saturday a "significant majority" but not all of creditors had signed on to its debt restructuring plan.
We take a look at some of the major debt restructuring deals of companies here in the UAE.