- Question ID: 2017/0009
- Date of publication: 09/08/2017
- Subject matter: Loans price and other conditions
- AnaCredit Manual: Part II
- Data attribute: Amortisation type
Could you clarify whether the reporting of the amortisation type should be based on the original payment plan as agreed at inception of the instrument, or should it be based on the actual payment plan? For example, if a loan has a French amortisation schedule but the debtor also has the right to redeem the loan partially or in full during the lifetime of the instrument, should the amortisation type be reported as “French” or “other” (i.e. French plus voluntary prepayment)?
The amortisation type is generally determined by the debtor’s obligations towards the creditor (e.g. it sets the minimum payment schedule) as opposed to the options the debtor has in addition to the minimum payment schedule.
Therefore, as regards the example in the question, it is clarified that the amortisation type for the instrument is “French” and the given option to prepay the instrument is not taken into account as it does not reflect a contractual obligation, regardless of how likely it is that the debtor will prepay.