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Sample Leveraged Finance Interview Questions

Here are some leveraged finance interview questions.
Why are financial maintenance covenants important?
If a company underperforms, allows creditors to apply pressure or take action before there is leakage to other stakeholders or before the situation gets too bad
What are some factors to look at when lending money to a prospective borrower?
What are some key modeling outputs or assumptions you will want to see when doing credit modeling?
What is Debt Capacity?
Debt capacity is the ability of a firm to service debt (scheduled payments of interest and principal).
What are some key credit ratios?
What will influence the appropriate leverage level for a borrower?
Typically, what is the minimum equity cheque for an LBO?
25-30% of the purchase price. Banks will not risk having a hung bridge loan by failing to syndicate debt capital markets issuance as they may receive punitive treatment from regulators.