Encouraged by strong demand, recent issuers around Europe are using creative EBITDA figures and increasingly flexible covenants. 9fin has recently highlighted these in our analyses Whatever Happened to EBITDAC? and European HY Covenants.

Tightening spreads are a prominent feature of today’s market. Given this, bondholders are rightly keen to retain higher coupon notes. However, the long-term trend toward leniency - and popularity - of redemption features has increased call risk for bondholders.

YTD 2021 has seen more refinancings than any other Jan-May period in the last decade, so it’s worth taking a look at the documentation to see what has facilitated this, and putting figures to how the following redemption/repurchase terms have developed over time:

1. Call Schedule
2. Equity Claw
3. 10% @ 103
4. Change of Control