Senior bank loans have a priority position over subordinated lenders with respect to interest and principal payments and typically have a fixed term, making option D correct. They do not necessarily have the first claim to all earnings and assets of the firm, as that position is generally reserved for secured creditors.

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Senior Bank Loans

Question 13

Multiple Choice

Senior bank loans:

A) Have a priority position over subordinated lenders with respect to interest and principal.
B) Have first claim to the earnings and assets of the firm.
C) Have a fixed term.
D) a and c only.
E) All of the above.

Correct Answer: