Senior Debt multiple

This is a key ratio that credit analysts assess when determining the level of risk upon a borrower. The formula is the amount of Senior Debt/EBITDA. Credit analysts compare this multiple to the EBITDA multiple that a company is valued at in order to assess the LTV % of Senior debt versus the company’s valuation or capitalisation. It is also used to set maintenance covenants that stipulate if a borrower exceeds agreed multiples over the life of the loan they will be in breach of their loan agreement.

Capital at risk. No FSCS cover. See Risk Statement.