Create a Standard Phase in a Facility Agreement Tranche

A facility agreement in Fairways Debt is an envelope involving different tranches subject to specific legal conditions (standard loans), which can be shared among pools of different lenders and borrowers. Third parties are not necessarily involved in all tranches. This type of financing transaction is widely used in the real estate sector.

Create:

  • Standard phases to add a fixed/floating rate change confirmed in the contract.
  • Phases with projected fixed rates to estimate the future fixed rate, based on the swap rate and a spread, and to create an event that will notify you when the rate will be fixed.
  • Phases with projected floating rates to create an event that will notify you when the new index is determined.

 

Prerequisite

 

Navigate to the Debt & Derivatives Application
  1. Log in to your Fairways Debt account, e.g. https://login.financeactive.com/eu.
  2. Select a customer account.
  3. Navigate to Applications > Debt & Derivatives.

 

Open a Facility Agreement Tranche
  1. Navigate to Draft.
  2. Click the relevant facility agreement to open its profile.

Draft_EN.png

  1. Click the relevant tranche to open its profile.

FacilityAgreement_EN.png

The tranche profile displays.

Tranche_EN.png

 

Create a Standard Phase in a Facility Agreement Tranche
  1. Click Create Phase > Create Phase.

Tranche_CreatePhase_EN.png

  1. Complete the form with all relevant details.

Notes:

  • Fields marked with an asterisk * are mandatory.
  • The tranche characteristics apply by default.

Field

Description

Start Date

Unadjusted start date of the phase.

Date_EN.png

Field

Description

Index

Name of the index used to calculate the rate value, e.g. FIXED for a fixed rate.

Note: The field beside displays depending on the index selected.

Interest Rate

Fixed rate value in percentage.

Note: This field displays depending on the index selected.

Initial Interest Rate

Initial rate of the custom index.

Note: This field displays depending on the index selected.

Spread

Spread (or margin) value in percentage.

Note: This field displays depending on the index selected.

Day Count Convention

Computes the day fraction of an interest accrual period.

Capitalized Interest

Defines whether the interest amount should be paid at the payment date, or added to the principal (and included in the outstanding balance for the following periods).

In Advance Interest Payment

Defines whether the interest amount should be paid at the start of the period.

Indexation_EN.png

Field

Description

Frequency

Frequency of the payments.

Interest Calculation Adjustment

Adjustment mode for the interest calculation. The nominal start and end dates of the accrual period will be adjusted accordingly before computing the interest amount.

Payment Date Adjustment

Adjustment mode for the payment date.

Last Stub Period

Defines whether the last period should be a short or long stub when it does not match the selected frequency:

  • Short Stub: The payment date just before the end date should be respected.
  • Long Stub: The payment date just before the end date is replaced with the payment occurring at the end date.

Note: If neither stub is selected, the short stub applies by default.

Schedule_EN.png

  1. Enable Apply to All Transactions to apply these characteristics to all transactions of the phase.
  2. Click Apply.

Phase_Create_EN.png

The new phase(s) display(s) in the tranche.

Phase_Created_EN.png

 

Adjustment

Adjustment modes define how the system rolls dates in case of holidays in the calendar.

Field

Description

Unadjusted

Not rolled.

Preceding

Rolled to the previous business day.

Following

Rolled to the next business day.

Modified Preceding

Rolled to the previous business day, only if that day occurs in the same month. Otherwise, rolled to the next business day.

Modified Following

Rolled to the next business day, only if that day occurs in the same month. Otherwise, rolled to the previous business day.

End of Month (unadjusted)

Rolled to the last day of the month.

End of Month (preceding)

Rolled to the last day of the month, then adjusted to the previous business day.

Modified Following (year)

Rolled to the next business day, only if that day occurs in the same year. Otherwise, rolled to the previous business day.

 

What's Next?
Was this article helpful?
0 out of 0 found this helpful