Greater flexibility for leveraged lending? Current supervisory approaches in the EU, the US and the UK

In the aftermath of the financial crisis bank supervisors increased their scrutiny of leveraged lending by banks due to the high-risk profile of such loans. In 2013/2014, the US supervisors took a prescriptive approach, inter alia by capping the regular leverage ratios at six times debt-to-EBITDA. In 2017, the ECB followed suit in its Guidance to supervised banks, while the UK supervisors favoured a more principles-based approach. In December 2025, the US supervisory approach changed, becoming... By: White & Case LLP