What is a common characteristic of Senior Secured Debt?

Senior Secured Debt is distinguished by several key characteristics, one of the most notable being its secured nature. This type of debt is backed by specific collateral, which gives lenders a priority claim on assets in the event of a default. The inclusion of typical bank debt, such as revolving credit facilities, is a hallmark of senior secured debt. These facilities allow companies to draw down on a line of credit, providing flexibility for cash flow management while being secured by the company’s assets.

The secured nature of this debt offers a lower risk to lenders compared to unsecured forms of debt, which do not have collateral backing. This aspect is what makes option B the correct answer, as it emphasizes the relationship between bank debt and senior secured debt. Other options do not accurately reflect the defining characteristics of senior secured debt, particularly its secured status and the priority it holds over other forms of debt in terms of claims on assets.