A Pragmatist’s Guide to Leveraged Finance: Credit Analysis for Bonds and Bank Debt

7. Some Features of Bank Loans

What’s in this chapter:

• Types of bank loans

• The role of the administrative agent

• Loan structure: coupons, amortization, calls

• Bank loans and amendments

Leveraged bank loans have many features similar to the bonds in the market. But they also have many unique features, some of which are described in this chapter.

Although these loans are typically called bank loans, syndicated loans, or just loans, in the leveraged finance market they are not always held by banks. However, they are usually initially arranged by banks. These loans end up being held and traded by a wide array of buy-side and sell-side participants. These loans are not securities, they are not traded on an exchange, and documentation for trades ...