Leveraged Finance and High Yield Credit Risk

A 4-step approach to any debt funding transaction: Purpose, sources of repayment, risk to repayment and debt structure. Market trends for leveraged transactions: leverage multiples, capital structures, parties and instruments, Market indicators of credit risk: Credit ratings, bond spreads, ratings curves, CDS pricing and equity price movements. Structure of analysis: qualitative and quantitative factors, Macro-economic and industry dynamics, Financial fundamentals in analyzing business and financial risk: using ratio and cash flow tools,
Legal, structural and economic subordination, The role of security, guarantees and third party support,Restrictive covenants,Default and recovery statistics in leveraged finance, Market indicators (bond market yields, CDS) and ratings as a basis for comparison