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Ratio AAA AA A BBB BB B CCC EBIT interest coverage 24 14 7 4 2 1 0.4 EBITDA interest coverage 25 17 9 6

Ratio

AAA

AA

A

BBB

BB

B

CCC

EBIT interest coverage

24

14

7

4

2

1

0.4

EBITDA interest coverage

25

17

9

6

3

2

1

Debt/EBITDA

0.2

1.1

1.7

2.4

3.8

5.6

7.4

Pre-tax return on assets (%)

35

27

17

13

10

7

2

Debt/book value of debt & equity (%)

6

35

40

46

57

74

101

Current credit spreads (%)

0.2

0.8

1.2

1.5

2.5

3.5

5.0

If ten year government bonds are yielding 2% - What is the yield on an A rated bond?

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