easy · Debt Capital Markets
In the context of 'Fundamental Credit Analysis', why is the 'Maturity Profile' (or maturity wall) important alongside leverage ratios?
- The maturity wall determines the interest rate the company pays on its current debt.
- Longer maturities automatically lead to lower EBITDA add-backs.
- It tells the analyst which rating agency is most likely to downgrade the company.
- A company with low leverage can still fail if it cannot refinance a large lump-sum maturity when the debt markets are closed.
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