...Full Covenant Set Declining: Structural evolution of the EMEA leveraged loan buyer base towards institutional investors and away from banks translates into a rapid decline in the number of senior secured loans with a full set of financial maintenance covenants. The inclusion of one such covenant, even if only tested when a revolving credit facility is drawn, would enable an institutional investor to classify the loan as covenanted. Currently, 22% of leveraged loan transactions undertaken to August 2015 have had a full set of financial maintenance covenants, down 5pp from 2014 in Fitch's Credit Opinion database. One Size Does Not Fit All: The relinquishment of a full set of covenants is most advanced for broadly syndicated deals with debt packages of EUR500m or more. Less than 10% of 2015 large deals have contained full covenant sets. However, club-style and direct lending transactions, particularly those with smaller debt packages, eg, below EUR200m, continue to require full covenant packages....
