For example, if you plan to repay $ 500 each month and the company gives $ 400 to your creditors it means
the cost of debt servicing is $ 100.
Even if the path for tightening is described as ultra-slow and measured, investors will need to weigh just how much the higher costs of borrowing might adversely impact
the cost of debt servicing for corporations; that is, we may see further erosion of profitability from an earnings picture that is already flat.
I don't know, but it's raising
the cost of debt servicing more than expected for lots of banks and businesses that borrow in the short - term debt market.
«In each of the years between 2027 and 2033, PWBM projects that the bill will continue to reduce revenues net of outlays, not including the additional
costs of debt service,» the Penn report said.
If the proposal is defeated, the district's real estate tax rate would decrease to reflect the lower
cost of debt service.
call for a revision of the current formula for setting rates which requires rates to be set to fully cover the cost of operating the system,
the cost of debt service for capital work and a rental payment to the City of New York, which is set at 15 % of the debt service,
Not exact matches
Meanwhile, as the government takes on more
debt to fund its daily operations, the
cost to
service that
debt will take up a larger chunk
of government spending as well.
By 2047,
costs of servicing the
debt are expected to total 6.2 %
of GDP, up from 1.4 % this year.
The
cost of servicing the exploding
debt would exert tremendous pressure on the government to eliminate investments that could fuel growth.
This will set off a vicious cycle
of higher deficits that lead to higher
debt, which in turn will mean higher interest
costs and less funding available for healthcare, education and other provincial
services.
Greece has committed to attaining a primary budget surplus — excluding
debt servicing costs —
of 3.5 %
of economic output by 2018 as part
of its third bailout package since 2010.
The Bank
of Canada, for one, has carefully assessed the economic risks
of consumer
debt in order to determine how quickly it can raise interest rates without piling on too many
debt -
servicing costs for over-stretched households.
And massive
debt service costs could limit the carrier's ability to maintain or raise the dividend on its stock, which is one
of the primary attractions for investors.
This is because the province has accumulated a large public
debt that given the prospects for an economic slowdown and / or rising interest rates will potentially increase fiscal pressure via
debt service costs which in 2016 - 17 totaled $ 11.7 billion or just over 8 percent
of total government spending.
Debt service costs have risen to 15 percent
of GDP — just short
of record highs — according to CLSA.
The
cost of borrowing in China has been cut aggressively since the autumn
of 2014 in response to the slowdown in the economy and the distress caused to property owners, local government and corporations by high
debt -
servicing costs.
What passed for Soviet Marxism lacked an understanding
of how economic rents and the ensuing high labor
costs affected international prices, or how
debt service and capital flight affected the currency's exchange rate.
This would sharply enhance growth rates during the expansion phase, much like margin borrowing enhances returns when market prices are rising faster than the
debt servicing costs, but at the expense
of sub-par performance once conditions reverse.
As the gap widens, it creates rising uncertainty about how excess
debt servicing costs will ultimately be allocated, and at the point at which this uncertainty is high enough to alter materially the behavior
of economic agents, and so lower the net asset value
of the economic entity, the borrowing country has «excessive»
debt.
I have explained elsewhere some
of the reasons that determine whether a country's
debt is «excessively high», and I hope formally to list these reasons more fully in my next book, but the key is the gap that is created between projected
debt -
servicing costs and the projected revenues earmarked to
service the
debt when an economic entity suffers an unexpected surge in
debt or an unexpected decline in growth.
To some extent, these concerns are allayed by the existence
of natural hedges, such as foreign currency export income, although rising US dollar - denominated
debt servicing costs at a time
of falling US dollar - denominated commodity revenues would obviously be problematic.
There are many other ways
of allocating a significant portion
of the
debt -
servicing cost to unwilling agents in the economic equivalent
of debt forgiveness: to creditors when
debt is repudiated, to workers when wages are suppressed in order to increase net revenues for
debt servicing, to small business owners when assets are expropriated to pay down
debt, and so on.
The non-partisan Congressional Budget Office (CBO) projects $ 10 trillion will be added to the federal
debt over the next decade and estimates the
cost of servicing the
debt will triple over the next 10 years.
In addition, the mortgage market looks set for a particularly heavy year
of renewals in an environment where
debt -
servicing costs are already rising at the fastest pace in a decade.
As the rouble falls, the
cost of servicing its mortgage
debt will rise.
Unfortunately, a major portion
of the
cost of living has become
debt service.
Huge amounts
of money have to be laid out for construction, tracts, and equipment, and getting enough money from ticket sales to cover the
debt servicing costs is problematic.
When the G - 7 deputies came to Moscow in late November 1991, just a few days after Gaidar had come to power as head
of Yeltsin's economic team, the main focus
of the G - 7 message was the urgency that the Soviet Union should continue to
service the external
debts at any
cost.
For example, people with lower incomes are likely to be sensitive to interest rate changes because
of the potential effects on their employment income and their
debt -
service costs.
3 It may seem willfully perverse to most analysts to suggest that a
debt - equity swap does not reduce
debt, but that is because most analysts do not think systemically and fail to consider the overall impact
of these transactions on
debt -
servicing costs and on contingent liabilities
of the government.
MH: The problem
of inadequate consumer demand to fuel an economic recovery does not lie with the
cost of labor so much as with the fact that it is now normal for families to pay a quarter or even a third
of their income for
debt service.
It occurred rather because in 2015 there was a series
of debt transactions (mainly provincial bond swaps aimed at reducing
debt -
servicing costs and extending maturities) that extinguished
debt that had been included in the TSF category and replaced it with
debt not included in TSF.
Higher borrowing
costs would discourage business investment and raise the
cost of servicing government
debt to unhealthy levels.
Corporate gearing ratios remain conservative by historical standards and
debt servicing costs remain low, reflecting the relatively low level
of interest rates.
Their self - destructive real estate bubble has loaded down their labor force with high
debt service and housing
costs, whilst their giveaway
of public infrastructure to insiders (with no price regulation) has led to high basic living
costs.
Mr. Ceci also announced that the government would legislate a
debt ceiling
of 15 percent
debt - to - GDP in order to hold off a risk
of credit downgrades and higher
debt service costs.
While falling world interest rates have reduced the
servicing cost of foreign
debt over the past two years, this has been offset by rising dividend payments on foreign holdings
of Australian equity, reflecting the strong profit growth
of Australian companies throughout this period.
At present, the properties generate a return
of 2.39 per cent before
debt service costs and 1.12 per cent after
debt service costs and the sweat equity Jack invests by doing all repairs, yard work, and so on.
Examples
of these risks, uncertainties and other factors include, but are not limited to the impact
of: adverse general economic and related factors, such as fluctuating or increasing levels
of unemployment, underemployment and the volatility
of fuel prices, declines in the securities and real estate markets, and perceptions
of these conditions that decrease the level
of disposable income
of consumers or consumer confidence; adverse events impacting the security
of travel, such as terrorist acts, armed conflict and threats thereof, acts
of piracy, and other international events; the risks and increased
costs associated with operating internationally; our expansion into and investments in new markets; breaches in data security or other disturbances to our information technology and other networks; the spread
of epidemics and viral outbreaks; adverse incidents involving cruise ships; changes in fuel prices and / or other cruise operating
costs; any impairment
of our tradenames or goodwill; our hedging strategies; our inability to obtain adequate insurance coverage; our substantial indebtedness, including the ability to raise additional capital to fund our operations, and to generate the necessary amount
of cash to
service our existing
debt; restrictions in the agreements governing our indebtedness that limit our flexibility in operating our business; the significant portion
of our assets pledged as collateral under our existing
debt agreements and the ability
of our creditors to accelerate the repayment
of our indebtedness; volatility and disruptions in the global credit and financial markets, which may adversely affect our ability to borrow and could increase our counterparty credit risks, including those under our credit facilities, derivatives, contingent obligations, insurance contracts and new ship progress payment guarantees; fluctuations in foreign currency exchange rates; overcapacity in key markets or globally; our inability to recruit or retain qualified personnel or the loss
of key personnel; future changes relating to how external distribution channels sell and market our cruises; our reliance on third parties to provide hotel management
services to certain ships and certain other
services; delays in our shipbuilding program and ship repairs, maintenance and refurbishments; future increases in the price
of, or major changes or reduction in, commercial airline
services; seasonal variations in passenger fare rates and occupancy levels at different times
of the year; our ability to keep pace with developments in technology; amendments to our collective bargaining agreements for crew members and other employee relation issues; the continued availability
of attractive port destinations; pending or threatened litigation, investigations and enforcement actions; changes involving the tax and environmental regulatory regimes in which we operate; and other factors set forth under «Risk Factors» in our most recently filed Annual Report on Form 10 - K and subsequent filings by the Company with the Securities and Exchange Commission.
«Most discussions
of how company balance sheets will react to higher yields assume an instantaneous jump in
debt -
servicing costs — but borrowing is fixed - rate for several years,» Barclays says.
Further,
servicing costs of those households with
debt are considerably higher than indicated by the average experience across the household sector, and have risen a good deal over the past ten years.
We are confident that the marked reduction in
debt service costs coupled with the operating efficiencies, we believe we can obtain through the relocation
of a majority
of our operations to California in the heart
of rice country, will set the stage for us to meet the ingredient needs
of large CPG and specialty food companies.
The rising
costs of inputs — agro-chemicals, seeds, fuel — as well as the need to
service rising levels
of farm
debt: combined with the downwards pressure on prices many farmers find themselves in a «
cost - price» squeeze
Many
of the city's expenses — like health care, pension
costs and
debt service — are difficult to control, Walsh said.
«No matter what the Administration is painting as a rosy picture that there's going to be a decrease in the overall
debt, I just don't see how a project
of $ 192 million plus other projects that we have been assured will move forward at a
cost of $ 93 million and knowing that union contracts will be up for ratification throughout the next several years, there's no way that the county can say that our taxes will not increase and that I can't imagine will be able to stay under the cap unless we decimate
services,» says Strawinski.
Speaking before the City Council on Wednesday, vice chancellor for finance Matthew Sapienza said it would be «unfathomable» not to have the nearly half - billion dollars, which represents 30 percent
of the system's senior colleges operating and
debt service costs.
·
Debt service on bonds issued by the MTA to fund the
cost of East Side Access is estimated to exceed $ 300 million in 2019 when the project enters
service.
The
cost of servicing the nation's
debt would have gone up rather than falling to its lowest level in a generation.
«In spite
of these challenges, we met both our
debt service obligations and personnel
costs.
Payroll will account for 62 percent
of the spending in 2018, non-labor operating
costs, 22 percent, and
debt service, 16 percent.