Question about Senior Debt
https://www.spglobal.com/marketintelligence/en/pa…
I was watching the videos in the above LCD Primer, and the guy talks about Senior Secured Loans. He said that Senior Secured Loans are only issued by non-investment grade companies. This made me realize that investment-grade companies do not use Senior Debt.
So what kind of debt do investment-grade companies use? Do they only issue corporate bonds? They must be able to obtain term loans from banks, correct? If so, how are term loans different from Senior Secured Loans and why are they called different things?
Bonds / Loans can be Senior Unsecured too
Any other primers publicly available? Is there a link to a library on the site?
IG names have senior unsecured debt. Given they're less risky they don't need to secure the debt with collateral. More risky names will need Sr. Secured structures so lenders are more comfortable
Thanks! This was helpful. Can investment-grade companies also use secured debt to obtain a lower interest rate? Or is that something not available to them?
And sort of a unrelated question, but what is the difference between notes and loans? Are notes more similar to loans or bonds?
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