Performance Metrics

OC test

Also known as: overcollateralization test

status: draft

Overcollateralization test. A ratio or target comparing collateral support to outstanding debt.

What to watch

If the OC test fails, cash usually diverts away from junior or residual holders until the test cures.

Referenced in 18 topics

Accounts and cash management mechanics Advance rates and the borrowing base mechanics Broadly syndicated loan CLOs asset-classes Cash flow modeling accounting-valuation Collateralized loan obligations (CLOs) structures CRE CLOs asset-classes Deal structures asset-classes Middle market CLOs asset-classes Rated note feeders structures Revolving, prefunding, and reinvestment mechanics Sample waterfall appendix Structural tests (OC/IC) mechanics Term sheet anatomy documentation The waterfall mechanics Top capital provider mistakes playbooks Trigger negotiation strategies mechanics Trigger remediation strategies mechanics Triggers, tests, and performance events mechanics