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Closely related to leveraging, the ratio is also known as risk, gearing or leverage. The two components are often taken from the firm's balance sheet or statement of financial position (so-called book value ), but the ratio may also be calculated using market values for both, if the company's debt and equity are publicly traded , or using a ...
Capital requirements govern the ratio of equity to debt, recorded on the liabilities and equity side of a firm's balance sheet. They should not be confused with reserve requirements, which govern the assets side of a bank's balance sheet—in particular, the proportion of its assets it must hold in cash or highly-liquid assets. Capital is a ...
On the other hand, almost half of Lehman's balance sheet consisted of closely offsetting positions and very-low-risk assets, such as regulatory deposits. The company emphasized "net leverage", which excluded these assets. On that basis, Lehman held $373 billion of "net assets" and a "net leverage ratio" of 16.1. [9]
The sale will initially lower the company's leverage ratio from about 6 times to between 2.5 times and 3 times at closing, further enhancing its solid investment-grade balance sheet (BBB/Baa3 bond ...
Our leverage ratio, defined as net debt to adjusted EBITDA, was 4.9 times at the end of the year. ... Our strong balance sheet, available cash, and debt capacity provides the opportunity to deploy ...
The leverage exposure is the sum of the exposures of all on-balance sheet assets, 'add-ons' for derivative exposures and securities financing transactions (SFTs), and credit conversion factors for off-balance sheet items. [11] [12] Basel III introduced a minimum leverage ratio of 3%. [13]
Furthermore, we maintained our net leverage ratio within our target range of two to three times, ending the year at 2.2 times net leverage. We continue to view our balance sheet as a strategic ...
A company's debt-to-capital ratio or D/C ratio is the ratio of its total debt to its total capital, its debt and equity combined. The ratio measures a company's capital structure, financial solvency, and degree of leverage, at a particular point in time. [1] The data to calculate the ratio are found on the balance sheet.