Deals
Stripped Safeguards Signal Hazards in Europe for Leveraged Loans
This article is for subscribers only.
Mario Draghi’s trillion-euro stimulus plan is making investors so desperate for yield that they’re giving up protections in Europe’s market for risky corporate loans.
The unprecedented flood of cash from the European Central Bank is allowing companies to borrow without many of the investor safeguards typically included in credit agreements, weakening the ability of investors to limit how much debt a company can have relative to its earnings. More than half of the