Private Credit Deals: Floating Margins, Upfront Fees & OID, PIK Interest, Call Protection & Lender Yield
Price a direct-lending term loan the way a fund does: margin over a base rate, discounts and fees at closing, interest paid in kind, prepayment premiums, undrawn fees and what all of it does to the lender's yield, with every cell checked as you go.
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About this course
In this course you price direct-lending loans the way a private credit fund does, step by step and with fictional deals. You apply a base-rate floor with MAX and compute actual/360 cash interest, turn an original-issue discount and an upfront fee into the lender's IRR and yearly yield, and roll a PIK balance forward. You charge commitment fees on a delayed-draw tranche, compare yields if a loan is repaid early under a call-protection schedule, solve a unitranche first-out/last-out split with SUMPRODUCT, compute expected loss and the yield after a default, and rank three loans on a loss-adjusted yield with RANK.EQ and a chart.
Lessons
- Floating-Rate Cash Interest: Base Rate, Margin and Floor Pro
- Upfront Fees and Original-Issue Discount: The Lender's Real Yield Pro
- PIK Interest: Interest Paid in Kind and a Growing Balance Pro
- Delayed-Draw Tranches: Commitment Fees and Blended Yield Pro
- Call Protection: Prepayment Premiums and Yield if Repaid Early Pro
- Unitranche Splits: First-Out and Last-Out Pricing Pro
- Credit Losses: Expected Loss and the Yield after a Default Pro
- Deal Comparison Dashboard: Yield, Cash Yield, PIK and Losses Pro