Non-Utilization Margin Added

Neil Mathieson. Tuesday, November 16, 2010

It is now possible to enter a Non-Utilization margin on funding transactions, allowing users calculate their Effective Interest Rate (EIR) and all-in cost of funding.

This is a requirement under IAS 18 and IAS 39 and, in times when many CFO/Treasurers have locked in committed headroom, an increasingly large number on the P&L.

Access and Data Entry

The Non-Utilization margin is located in the Deal Details tab of the Deal View.

The Non-Utilization margin is calculated based on Limit (located in General Data) minus the current Nominal.

The Non-Utilization margin is calculated and applied on the same basis as Margin (Spread) (also located in Deal Details, with Conventions is separate tab).

Non-Utilization Margin Analytics

Deal Level

At present the Non-Utilization margin is added to the Margin (Spread) and reported as total Cash Flow interest.

In due course this will be reported as a separate field to provide greater visibility.

Portfolio Level

If a user enters an Non-Utilization margin this will automatically be added when calculating and reporting Accrued interest, Effective interest, Interest payments and Interest Cost.

Coupon Rate will continue to be reported as the prevailing interest rate on the drawn portion of the funding. 

Existing Users

The Non-Utilization margin has been added with a default of 0%. This ensures that existing deals are unaffected, thus allowing you to make comparisons with previous periods without having to make adjustments.

Further Enhancements

Over time we intend to build additional functionality around (i) Committed versus Uncommitted funding and (i) the utilization versus agreed Limits, which is often a KPI of treasury.

If you have any questions in the meantime then please contact us.

Latest News

Enhanced User Support

1/17/2012  News categories: New functionality 

European Debt Crisis - Implications for Corporate Treasurers?

1/11/2012  News categories: Column 

Interactive Portfolio View Charting

11/28/2011  News categories: New functionality 

Advisory Fees Opportunity, Portfolio Swaps

11/15/2011  News categories: New functionality 

Interpolation Methodology Enhancements

11/7/2011  News categories: New functionality 

TreasuryView Newsletter

Find this page useful?
Our e-mail newsletter contains practical articles on financial risks and informs you about new features in TreasuryView

You will also receive our Research which contains practical information from the world of risk management, read by many top financial institutions. You can unsubscribe easily any time.

Notes to users:
We are constantly expanding our functionality and improving the user experience. This requires to make changes from time to time.
This may result in small discrepancies between the help section and system, for which we apologise.

KFPD GmbH / TreasuryView Software Ltd 2007-2011 All rights reserved   Copyright  |  Disclaimer  |  Privacy |  Contact us