itsual Debt Management
Overview
Debt can accelerate growth or create existential risk. Active debt management tracks covenants, maturities, and capacity before problems become crises.
When to Use
- Covenant calculation and reporting
- Facility utilization planning
- Refinancing and amendment processes
- Stress-testing debt capacity
Core Practices
- Maintain a debt schedule with rates, maturities, and covenants
- Calculate covenants early and often — not only at certificate dates
- Forecast headroom under base and downside cases
- Engage lenders early if headroom is tightening
- Model refinancing lead times realistically
Principles
- Covenant breaches are often foreseeable
- Relationship and transparency with lenders matter
- Short-term patches can worsen long-term structure
- Know your springing and cross-default terms
Verification
- Debt schedule is complete and current
- Covenant headroom is forecast, not only historical
- Maturity wall has a refinancing plan