Capital and debt

February 28th, 2013 by Altman Weil

According to a recent survey of 171 law firms (including 122 Am Law 200 firms) from Citi Private Bank, paid-in capital per partner has been increasing over the last few years, while debt levels are decreasing.

“Between 2007 and 2011, partner paid-in capital shot up by a third, from an average of $229,000 to $303,000 per equity partner; as a percent of net earnings, paid-in capital on the balance sheet went up from 21 percent to 26 percent.”

and

“As the use of partner capital rose, borrowing dropped. Only 7.4 percent of total capitalization in 2011 was borrowed, down from 10.3 percent in 2007.”

Concerns over ongoing uncertainty and volatility in the global economy was cited by firm leaders as a driver of this trend.

Read it at The American Lawyer

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