Abstract
Debt covenants have become one of the major issues that affect the operations of the firm. Many scholars have come up with different ways in which they can leverage this problem. There are many theories of corporate governance that try to solve these problems that face managers of financial institutions. Most of these theories defy the debt covenant perspective and the corporate governance problems in relation to how equity and debt holders affect the director’s ability to act in the interests of the providers of capital. Banks as financial intermediaries have special attributes that increase the standard corporate ...
