How to Enter a Loan

Created by Erik Åkerlund, Modified on Wed, 07 Feb 2024 at 11:49 AM by Jenny Johansson

Front Office > New Deal

  1. Choose New deal - Loan & Deposits.
  2. Loan type: Loan=If the Legal entity is lending funds.  (If Deposit; choose 'Deposit' and the cashflows will be the opposite)
  3. If an amortizing Loan choose between Annuity or Straight amortisations (fixed amount for each payment period), by default No amortization is set.
  4. The Loan can be linked to a specific Credit Facility by selecting the Credit Facility i the drop down list under 'Credit Facility'. (note that the Loan can also be linked directly in the Credit Facility registration window)
  5. FX Conversion Rate: if you have a different currency on the Credit Facility and you want to convert the drawdown into a different currency amount, this is done using an FX rate entered here.
  6. Fill in the Notional (Currency and Amount) and Dates (Deal Date, Begin Date, End Date) in TAB "Basics".
  7. Fill in all valid data in TAB - Interest. Choose Fixing index when Interest type Floating is chosen.  'Base interest %' for first period is filled automatically and the interest period is thereby Fixed. If first fixing period is Broken (uneven) the 'Base interest %' will be interpolated.
    If no "ibor" rate are show in the list, this needs to be predefined in Market data set up as it can't be left blank.  
  8. Fixing and payment period can be entered with different period if that is agreed.
  9. Last day of period: Checked = adjust roll date to last day of period. For example if a period ends on the 30th of March the date will be adjusted to the 31st in accordance with the business day convention (Date rolling behaviour).
  10. Choose correct day count convention. For more details see Interest day count convention
  11. Three options for adjust dates:
    • None = no adjustment on either maturity or payment date.
    • Payment date = Only payment date will be adjusted. If maturity date falls on a Sunday the interest rate will be calculated until Sunday but paid on Monday (or according to chosen business day convention).
    • Maturity and Payment Date = Both interest calculation date (maturity date) and payment date will be adjusted according to the entered business day convention.
  12. Bank accounts are set according to the set up in Default Bank Accounts. Legal entity's bank accounts must be filled in (mandatory fields) for both legs. Counterpart's bank account are optional.
  13. TAB Tags are optional. If it is an internal deal the mirror will get the same tags. 
  14. TAB Finish if additional bank holiday calendar will be added this will be done on tab - Finish. By default the transactions currency will be set as effective calendar.
  15. If an internal Loan and an automatic mirror deal shall be created this needs to be set up in Mirror Rules. The rule can be overruled here by changing from "Use rule" to No Mirror or Create mirror in field Mirror creation type.
  16. Press Save


Transactions (interest to be paid):

Loan with amortisation:

The most common loans with amortisation are with the linear method, Straight (Normal). The amortisation can be started at once or on a future date further ahead. 

Residual shall not be filled in if it is not a Leasing loan with a residual value. Leave blank. If the first amortisation shall start a year ahead and then every 3rd month the below are filled in.

First amortisation amount is only need to be filled in if it differs from the ordinary linear amount. In the last amortisation amount field the amortisation amounts are calculated so the amortisations are the same value every time till the last amortisation will be 11 111 111,11. If it should be another amortisation amount then overwrite it. You can never amortise to much (more than the loan amount), then you get an error message.

Changed the amortisation amount to 5 000 000.

Different types of amortisations are explained in the article Amortsation type click here Amortisation Type

How to Edit and remove an amortization or Capital increase (Loan, IRS), klick here How to Edit and remove an amortization or Capital increase


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