The power to leverage opportunity

By: Bernard Hecht

Among the many facets of analysis offered by the DBC Finance program is the ability to immediately and simply select the relative benefits, across one or many bond issues that each and every principal maturity would generate.

The program provides two methods that user can select:

  • Method One (Calculate Using Remaining Maturity): Compute the savings of each maturity by computing the refunding including all bonds except for that maturity, then examining the difference in savings that results between that and the full refunding.
  • Method Two (Calculate Using Individual Maturity): Compute the savings of each maturity by computing a refunding with only that maturity, and examining the savings for the refunding.

Report options include:

  • Show nominal savings: Show savings and savings percentage in nominal dollars and percentage. Nominal savings are the calculated savings adjusted by any fixed costs.
  • Show adjusted savings: Show savings and savings percentage in dollars and percentage adjusted by each maturity’s percentage of overall savings. This is the savings by maturity, which is a fraction of the net PV savings prorated by the nominal savings of each maturity. It is computed by multiplying the net PV savings of the entire refunding by the nominal savings of the maturity, divided by the total nominal savings.
  • Show calculated savings: This is the relative contribution to savings for each prior bond maturity, ignoring the effect of fixed costs of issuance and fixed underwriters discount components. Using the “remaining maturity” method, this is the difference in net PV savings, calculated with and without this maturity. Using the individual maturity method, this is the net PV savings of the refunding of the maturity by itself.

This is all achieved with the press of a button, and is just one of the many refunding analysis options that the DBC Finance program provides.

For more information about DBC Finance, download our brochure, request more information or a demonstration or email solution@sscinc.com