Credit Analyst Interview Question:

Explain me what is a reasonable Debt/Capital ratio?

Submitted by: Muhammad

It completely depends on the industry. Some industries can sustain very low debt to capital ratios, typically cyclical industries like commodities, or early stage companies like startups. So these would have 0-20% debt to capital. Other industries like banking and insurance can have up to 90% debt to capital ratios.
Submitted by: Muhammad