easy · Debt Capital Markets credit-ratings-risk
What is the purpose of a 'Negative Pledge' covenant?
- It forces the borrower to pledge all its cash to the lender in a crisis.
- It prevents the borrower from granting security interests in its assets to other lenders.
- It requires the borrower to maintain a negative net debt position.
- It prevents the borrower from making negative comments about the bank in public.
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