Having done my fair share of bank finance, it's honestly hilarious the bank lobby is pretending it didn't realize this "loophole" until now. When a bank lends money as a standard term loan to a corporate entity, the entire framework (reps, covenants, collateral) rests on how you ringfence the "restricted group" -- ie, the group of affiliated entities that abstractly form the overall corporate you're underwriting. Within the ringfence, entities have a lot of freedom to deal with themselves, but it's incredibly important the "value" of the corporate remains within the ringfence and is subject to all the covenants, etc. Many times there are "unrestricted" entities outside the ringfence that are allowed to do things like distributions, etc that normal restricted entities cannot. And unsurprisingly, there are firewalls in place to prevent funny business between restricted and unrestricted entities (eg, you can't sell all the assets from the restricted group to an unrestricted entity for 1). Controlling how corporate entities interact to pass value is like banking 101. To think for a second that the BANKING LOBBY didn't already try and negotiate this point and is now saying "oh deary me, we didn't realize AFFILIATES weren't subject to these restrictions and could pass along yield-like rewards... we need to fix this loophole" is some of the most deranged gaslighting you'll see all year.(Scott Johnsson)