European credit documentation trends: covenant-lite or covenant empty?

European credit documentation trends: covenant-lite or covenant empty?

jibflmayIn this month’s Butterworths’s Journal of International Banking and Financial Law, Karl Clowry, partner in the London office of Paul Hastings LLP, considers the recent developments in, and issues arising under, certain key covenants in European credit documentation in view of the widespread adoption of covenant-lite terms in the US leveraged finance market.

Karl notes that European leveraged loan documentation increasingly includes sponsor-friendly “covloose” even if not true “cov-lite” terms on a number of large acquisition and refinancing transactions and that many institutional investors in European credits are broadly accepting of such legal changes in order to obtain yield, weighed against an increase in inherent risk on such structures. For the full article, click here.

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Miranda is a solicitor specialising in leveraged and acquisition finance. She trained at Hogan Lovells International LLP and qualified into the international banking and finance team. During her time at Hogan Lovells she worked on a variety of domestic and cross-border transactions, acting for both borrowers and lenders. She also experienced secondments to Barclays Bank PLC and Kaupthing Bank hf.