Financial Times FT.com

S&P warns of growing risk in leveraged loans

By David Oakley

Published: February 13 2008 02:00 | Last updated: February 13 2008 02:00

A growing number of leveraged loans backing private equity buy-outs are in danger of breaching covenants or defaulting, according to research by Standard & Poor's.

These companies are carrying much more debt than they should, a sign of potential trouble, particularly in the event of a US recession or more turbulence in the markets, says the rating agency.

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