1.1.4 Swing Lines

A borrower requests for a participant to get certain amount of drawdown payment. In some cases, there could be delay of 1-2 days in between the borrower request for a drawdown and the actual disbursement from the participants. The reason for delay could be on account of documentation, legal formalities, and so on.

In case the borrower urgently requires the funds, the borrower can avail the funds immediately using a Swing Line. The swing line has the following features:

• Swing line is nothing but an ad-hoc line that is available from participants to borrower as a short term measure.
• For a participant, the swing line limit should not cross the share amount of the participant in the tranche.
• All the swing amounts (In case there is more than one participant) should be disbursed on the same day. In case of multiple swing line days, new drawdown should be entered for each of the swing line date based on the participants for the swing line for that day.
• System does not ensure the closure of the swing line drawdown, before the initiation of regular drawdown as there is no linkage between the swing line and the regular drawdown. This has to be operationally controlled.
• You are not allowed to do rollover for swing line contracts.
• Swing line drawdown is allowed only for normal and bearing contracts.