Highly Leveraged Transaction (HLT)

Glossary

Banking

Highly Leveraged Transaction (HLT)

The European Central Bank defines leveraged transactions for the purposes of bank supervision as those where a borrower’s leverage total debt to EBITDA post-financing is above 4x; as well as all loans or credit exposures to borrowers owned by financial sponsors (private equity firms). Highly leveraged transactions are those where total debt to EBITDA multiple is above 6x.

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