Question

Why the system does not update the “NC” principal movement in SL.ACCOUNT.BALANCES
table, when we do PRINCIPAL MOVMENT using SL.BUY.SELL?

Answer

Whenever non contingent portion is sold from existing participant to new participant,
SL.ACCOUNT.BALANCES will include new participant and show amount as zero (Since it is
an already disbursed amount). However, SL.LOAN.PART.BALANCES file will hold the amount
bought by the new participant.

Question

How does SL support past due?

Answer

In order to activate PAST DUE, we need to activate the field LIQUIDATION.MODE of

SL.LOANS with the value INTERNAL.

If a Repay schedule is processed and the account has no credit and the above field is set,
then the Repayment amount will be moved to SL.OD.

DUES will be built in COB. If a Repay schedule is processed at Start of Day, SL.OD.DUES will
be built for the unpaid amount.

The repayment of SL.OD.DUES will be done using the SL.OD.SETTLE template.

Question

How to do DEFINE adhoc Repayment schedules for SL.LOANS?

Answer

In SL.REPAYMENT.SCHEDULES, The following sets of fields are used to define adhoc

repayment schedules.

REPAY.TYPE:
----------
This field indicates the adhoc schedule type for loan and facility. The user can input a single
schedule (P- principal and I Interest) or a valid combination of schedules (PI Principal and
Interest).

REPAY.DATE:
----------
This field indicates the date of the event. If a multiple period contract is involved and the
date inserted in this field does not represent the maturity date, this field will represent the
starting date for the next period.
REPAY.PERC:
-----------
The scheduled amount expressed in percentage format. When input, system calculates and
updates REPAY.AMOUNT.

REPAY.AMOUNT:
-------------
The amount of Loan schedule.

Question

To which account, Participant’s Accounting entries will be raised?

Answer

Accounts for accounting entries will be selected in the SPVCN order.

SPVCN stands for,

S - Customer.SSI - First preference will be given to the a/c defined in this table ,for
settlement reasons.
In ACCOUNT.PARAMETER there is a field called CUSTOMER.SSI which has to be set & a
record having customer ID of the participant must exist in CUSTOMER.SSI table.

P - Portfolio No - Currently N/a. More to do with securities related settlement defaults.

V - Vostro - Will search Agency record with ID being the customer ID of the participant &
will retrieve an a/c only if the currency of the contract matches the a/c ccy.

C - Customer Acct - Will search in CUSTOMER.CCY.ACCT and retrieve the first a/c found.

N - Nostro Account - Picks the default Nostro Account from NOSTRO.ACCOUNT table for a
given ccy.

We can make the required setup for participant's a/c as we need.

Question

What is the reason behind the restriction that FACILITY cannot be reversed/ deleted?

Answer

FACILITY record is always created by the system only through PRE.SYNDICATION.FILE and
PRE.SYNDICATION.FILE cannot be input after setting CREATE.FACILITY to YES. User is not
allowed to create a FACILITY record directly. Therefore it is not advisable to delete a
FACILITY record which is in HOLD status.

It is not allowed to reverse a FACILITY record, as collection and distribution of underwriting

fee and accounting for underwriting will be handled at PRE.SYNDICATION.FILE stage itself.
Question

What is the purpose of TR.AMOUNT field in SL.BUY.SELL?

Answer

The field TR.AMOUNT is meant to input the value of facility reduction or increase (Principle
movement) relevant to the said tranche. For instance, we have a Facility of 100M containing
2 Tranches, TR1 for 60M and TR2 for 40M. TR1 has been drawn for 50M and 10M is now
pending utilisation. At this point, if it is desired to increase the drawing power of the Facility
by say 40M, of which 30M is to be attributed to TR1 and 10M to TR2, then we define the txn
as below:

Field Value Remarks

TOTAL.SL.AMT 40M Aggregate value by which the Facility is enhanced

TR.CODE 01 Tranche where movement is to be effected

TR.AMOUNT 30M Amount of enhancement at Tranche level (TR1)

TR.CODE 02 Second multivalue set

TR.AMOUNT 10M Second multivalue set

Question

What is the reason behind the restriction that SL.ROLLOVER cannot be reversed?

Answer

Amendment to rollover entails correction to SL.LOANS, LIMIT, and ACCOUNTING etc which
will impact the DATA Integrity. Therefore it is restricted to reverse.

If the user requires any Amendment to the Roll over Instructions, they can do so once the
loan becomes live.

Question

While doing SL.BUY.SELL, the system only distributes funds but sometimes the sum does
not equal to the Principal movement amount. Why does it happen?

Answer

To understand this, let us take an example.

The Tranche Amount is input as 10,000,000 and flag Pm. Prorata is set to YES. So System
splits the Tranche amount 10,000,000 between each participant with the amount
3,333,333.333333 automatically. Now total of PartAmount is equal to USD
9,999,999.999999. Hence the error message is displayed. The system cannot adjust the
remaining amount .000001 with any participant in default. Adjustment should be done
manually.

To resolve the problem the amount .000001 should be added to Part Amount ( i.e.,
PartAmount:3,333,333.333334) of any in three participants. Now the Total of Part Amount
will be 10,000,000 which is equal to TR.AMOUNT.

Question

What is the purpose of ALLOWED.AMT & RESERVED.AMT fields of FACILITY?

Answer

ALLOWED.AMT:

The maximum amount that is allowed. Customer could draw under the facility. If the user
desires to restrict the amounts drawn by a specific customer, the maximum exposure level
to this client could be defined in this field. Any drawing resulting in exposure (aggregate live
drawings including the drawing that is input) breaching this level would not be allowed.
Aggregate of Allowed.Amt could exceed the SL.AMOUNT.

RESERVED.AMT:

The amount of facility that is reserved for the Allowed.Cust. The amount that is mentioned
in this field is reserved for the allowed customer and not available for others in the group. It
must be less than or equal to Allowed.Amt for the respective Allowed .cust

Ex.; A, B, C are part of a Conglomerate where A is the facility customer. A credit line of
1,000,000 is shared as follows;

Customer Reserved.amt Allow.amt

A 250,000 400,000
B 100,000 250,000
C 300,000 500,000
Total 650,000 -----

Aggregate Reserved.Amt may not exceed Sl.Amount. In order to protect the reserved
amount for others in the group, the allowed amount for a specific customer may not exceed
the facility amount less the aggregate of reserved amount of all other customers. In this
specific example, the allowed amount for A may not exceed 600,000 (1,000,000 less
400,000 reserved for B & C).

Allowed.Amt and Reserved.Amt should be decided by the user.

Question

Amortisation of Premium/Discount on buying SL loans does not get adjusted for Principal
change. Why?

Answer
The Principal change of a SL.LOANS will not affect the PL- premium/Discount caused by
SL.BUY.SELL. SL Buy-Sell AMORTISATION will start with the value date of SL.BUY.SELL and
end with the Maturity date of the Sl.Loans. It will not change depending on the updates of
Sl.Loans.

Question

How will the system behave on schedules if we do a principal change for discounted
SL.LOANS?

Answer

Whenever a principal increase is made under a discounted loan, we need to redefine

schedules for future dates in SL.REPAYMENT.SCHEDULES template.

Question

The Revolving FACILITY is not getting reinstated at repayment of SL.LOANS. What would be
reason?

Answer

If the Liquidation Mode is INTERNAL and repayment is moved to SL.OD.DUES due to

insufficient fund, then Revolving FACILITY will not get reinstated. The facility will be
reinitiated only on settling the OD.DUES through SL.OD.SETTLE.

Question

What are the Accounting entries related with underwriting at PRE.SYNDICATION.FILE?

Answer

When we add underwriting concept in SL, the system will raise CONTUW entry for the own
bank’s share. When we set the field CREATE.FACILITY to “YES” in the application
PRE.SYNDICATION.FILE, Contra entry will be raised. Until creating the FACILITY,
Underwriter will be responsible for the amount of guarantee and so CONTRA entry will be
raised only at the creation of FACILITY.

ACCT.UNDERWRITING field in SL.PARAMETER application is used to determine whether

contingent entries are to be raised for underwriting by T24 bank. If this field were flagged to
YES, contingent entries with asset type CONTUW would be raised forT24 bank’s portion of
the underwriting.

Validation Rules

• The only values allowed are YES and NO. Null means NO.

• Change permitted only from NO to YES. Once the field has value YES, no further changes
are allowed.

• Optional input
Question

Why is MT202 not triggered during the repayment in SL.LOANS when own bank acts as an
Agent for the syndication?

Answer

As per the current design, MT202 will not be produced at Repayment of SL.LOANS, since
there is no direct transfer between banks. However, we can define a user-defined
EB.MESSAGE.CLASS and create a MT202.

Question

What functionality will be implemented by “CA” type of FEE.CALC.BASIS in FACILITY?

Answer

“CA” is a new type of calculating commitment fee where commitment fee would be charged
on the commitment available amount for drawdown and also on the unavailable
commitment amount. In this case, two commitment fee percentages could be defined to
calculate commitment fee on the available amount and on the unavailable amount. It is
mandatory to create ‘reserve’ tranche(s) for “CA” type of FEE.CALC.BASIS. These tranches
will hold the ‘unavailable’ part of the commitment With “CA” type

Question

How to increase/decrease the facility amount, in the lifetime of the FACILITY?

Answer

We can increase/decrease the facility using SL.BUY.SELL application. If the requirement is

to reduce the FACILITY amount from USD 6,800,000.00 to USD 3,400,000.00. We can
achieve this with “PM” TXN.TYPE of SL.BUY.SELL as given below. After authorising this
record, kindly check the LIMIT records.

BNK R05BASE SL.BUY.SELL SEE

ID................ SL/….
------------------------------------------------------------------------------
1 VALUE.DATE........
2 TXN.TYPE.......... PM PRINCIPAL MOVEMENT
11 TOTAL.SL.AMT...... -3,400,000 -->Amount to be reduced.
13 PREM.DISC......... 0
14 AMORTISE.PREM.DISC NO
16. 1 TR.CODE........ 001 --> Respective tranche number
17. 1 TR.AMOUNT...... -200,000
19. 1. 1 PARTICIPANT. 100124 --> Participant
20. 1. 1 PART.AMOUNT. -100,000.00 --> Participant share
19. 1. 2 PARTICIPANT. 100174 --> Participant share
20. 1. 2 PART.AMOUNT. -100,000.00 --> Participant share
44 CURR.NO........... 1