Long-term bank loans to equity

Method of calculation

Formula for long term bank loans to equity: long-term credits and loans / equity * 100%

Ratio's description

This ratio complements the information provided by the long-term debt to equity ratio, by including the effects of long-term credits and loans.

Ratio's interpretation

  • High values and an increasing trend are assessed negatively and interpreted as a deterioration of company's creditworthiness, because of the growing influence of long-term credits and loans on the level of equity.