Calculating the Loan Life Coverage Ratio (LLCR)

By Daniel Gross | November 13, 2019


The Loan Life Coverage Ratio (‘LLCR’) is perhaps the second most commonly used ratio in project finance. It is most often used to:

  • Size the amount of debt the project can sustain, particularly for borrowing base facilities
  • To review the ability of the loan to be repaid over the total loan tenor
  • To monitor the performance of the project against the loan documentation

The LLCR is a must-know for analysts and is a practical ratio to consider the total ability of the cash flow

The LLCR is monitored by the lenders throughout the life of the loan

The LLCR is a little harder to calculate than the DSCR, so we have included an example spreadsheet for you, which you can download by completing the form on this page.

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