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Abstract
This article examines why there are differences in the protections in the documentation for bonds issued by investment grade substantial corporates and syndicated bank loan agreements in favour of the same issuers. The particular differences arise mainly in relation to bank and bondholder covenants and events of default. These differences could enable banks to engineer a restructuring so that they are paid out ahead of bondholders. The article concludes that, although various other explanations have been put forward, the real reason may be that, for practical reasons, in restructuring negotiations banks have not taken advantage of their privileged position to outwit bondholders in a sufficiently large number of cases to lead to a change in bond practice. But this situation might change.