gearing
n. uncountable C1 Advanced US //ˈɡɪɹɪŋ// UK //ɡˈiəɹɪŋ// gear·ing
n. the relationship between how much money a company borrows and how much it actually owns. You use this to see how much risk a business is taking with its debt.
n. the ratio of a company's loan capital to its equity capital. Refers to the level of financial leverage or indebtedness relative to shareholder funds.
The company's high gearing makes it a risky investment.
During the recession, firms with high gearing struggled to meet their interest payments as revenue declined.
The board proposed a new share issue to raise equity and reduce the firm's gearing, aiming to improve the credit rating before the next round of expansion.
Usage
Commonly used in British and Australian financial contexts; equivalent to 'leverage' in American English.