Enhanced Debt/Loan Refinancing Analysis Excel Tool (Excel XLSX)

Enhanced Debt/Loan Refinancing Analysis is crucial for optimizing a company's financial structure. It helps identify opportunities to lower interest rates, extend repayment terms, or adjust loan covenants, reducing borrowing costs. By evaluating various refinancing scenarios, it ensures sound decision-making, enhancing liquidity and financial flexibility. Additionally, it can unlock potential savings, improve creditworthiness, and reduce financial risk. This analysis aids businesses in managing their debt more efficiently, freeing up resources for growth initiatives and enhancing overall financial stability and resilience.

PURPOSE OF TOOL
User-friendly Excel tool for calculating the financial impacts from refinancing up to 10 existing loan facilities with up to 30 new loan facilities in order to help the users make informed refinancing decisions.

METHODOLOGY
The template compares the remaining cash flows to maturity of existing loan facilities to net cash flows following the refinancing of these existing loan facilities with new loan facilities. The cash flows are calculated on a monthly basis for up to 20 years. The template allows calculations for up to 30 existing loan facilities and 30 new loan facilities. Each loan facility is specified and calculated separately and contains a full reconciliation from opening to closing balance for each month.

KEY OUTPUTS
The tool computes a number of:
•  Net cash flow comparison of existing facilities to maturity vs existing/new facilities following refinancing;
•  Loan balances for each month/year by facility, lender, loan type and base rate type;
•  Total interest expense comparison of existing facilities to maturity vs existing/new facilities following refinancing;
•  Full control account for each loan facility (opening balance to closing balance reconciliation);
•  Exposure charts showing splits by lender, loan type and base rate for a particular projection year;
•  Charts showing developments of cumulative cash flows, interest expense and loan balances on total basis.

KEY INPUTS
The key user-defined inputs of the tool are split into setup inputs, facility inputs and other projection inputs as follows:Setup Inputs:
•  Business or individual name
•  Currency
•  First projection year and month
•  List of base rates (up to 5 – but can be extended)
•  List of lenders (up to 5 – but can be extended)
•  List of loan types (up to 5 – but can be extended)

Facility Inputs:
•  Facility Name;
•  Lender (from list of lenders specified above);
•  Facility type (from list of loan types specified above);
•  Balance at start of projection period (for existing facilities only);
•  Start Date (for new facilities only);
•  Maturity date;
•  Base rate (from list of base rates);
•  Margin rate;
•  Interest-only or amortising loan (drop down);
•  Payment frequency (monthly, quarterly, semi-annually or annually)
•  Transaction costs (for new facilities only);
•  Existing facility the new facility is replacing.

Other Inputs:
•  Base rate forward interest rates
•  Specific repayment amounts for existing and new loan facilities

STRUCTURE
The template contains, 7 tabs split into input ('i_'), calculation ('c_'), output ('o_') and system tabs. The only tab to be populated by the user are the input tabs ('i_Setup' and ‘i_Assumptions'). The calculation tab uses the user-defined inputs to calculate and produce the template outputs presented in 'o_Results'.System tabs include the following:
•  'Front Sheet' containing a disclaimer, instructions and contents;
•  Checks dashboard containing a summary of checks by tab.

OTHER KEY FEATURES
Other key features of this tool include the following:
•  The tool follows best practice financial modelling guidelines and includes instructions, checks and input validations;
•  The tool can calculate projected cash flows and balances for up to 30 existing and 30 new loan facilities;
•  The tool can calculate projected cash flows and balances on a monthly basis for a maximum period of 20 years from projection start date;
•  The tool can calculate projected cash flows/balances for an interest-only debt / loan (all principal is paid on maturity date) or an amortising debt / loan (principal is paid as part of the periodic installments across the life of the loan);
•  Business/individual Name, currency, projection start, facility names, lender names, base rates and loan types are fully customisable;
•  Each loan facility is specified and calculated separately and contains a full reconciliation from opening to closing balance for each month;
•  The tool includes a checks dashboard which summarises all the checks included in the various tabs making it easier to identify any errors;
•  The tool includes checks and input validations to help ensure input fields are populated accurately.