3.2 Linkage

This topic describes about Linkage.

Once exposure codes are created, they can be linked to specific customers and their credit facilities. This linkage ensures that any drawdown or utilization on a facility is automatically reflected in the associated exposure, allowing for comprehensive tracking of a customer's various contracts at a single exposure level.
  • Customer to Liability Linkage Maintenance: Link the lowest-level exposure code (or the one that fits the business hierarchy) to the customer
  • Facilities Maintenance: Link the exposure code to the customer's credit facilities.
By establishing these links, the system monitors all allocations and triggers an alert if any further allocations exceed the defined limit.

Note:

  • It is possible to link and track multiple exposures against a customer and their facilities.
  • Exposure codes can be linked at all levels of an entity hierarchy, such as mainline and sub-line.
  • If the same exposure code is linked to both the sub-line and the main line, utilization or blocking at the sub-line level will indirectly update the main line. However, the linked exposure code will be updated only once based on the direct utilization at the sub-line level.
  • When the utilization or block currency differs from the exposure currency, the system applies the appropriate exchange rate from the exchange rate maintenance. This ensures accurate updates to the headroom limit at exposures.

For more information, refer to Customer Liability Linkage Maintenance and Facility Maintenance User Guides.

Example: The below examples depict a sample flow for exposure linkage.
  • ABC Corp’s USD 20M mining focussed revolving credit facility is linked to exposure code ‘GOLD_NA’ (Gold Mining – North America) of type Transaction.

Table 3-18 Flow of ExposureLinkage

Customer Facility Code Facility Limit Linked Exposure Code Exposure Limit Remaining Allocation Limit(Headroom)
ABC Corp F100 USD 20M GOLD_NA USD 30M USD 10M
  • Any further allocation towards facility that results in breach of the available headroom limit, will require exception approval.

    Table 3-19 Flow of ExposureLinkage

    Exposure Code Description Exposure Limit Remaining Allocation Limit(Headroom) NEW Facility Request Status
    GOLD_NA Gold Mining_North America USD 30M USD 10M USD 50M Breach

Parent topic: Exposure Usage in OBELM