Training Guide

Interest in Lending


Training Guide

Interest in Lending

Commercial Lending
Remote or in person

What’s Covered

  • Benchmark rates
  • Interest rate swaps
  • Floating rates
  • LIBOR 
  • Interest rate calculations
  • Basis points

Before the Session

Prepare the Attendees

Send the attendees an invitation for the session. Include this link, which has the videos and exercise they’ll need to prepare.

Prepare Yourself

Watch the videos and read the exercise so you’re familiar with the Hotshot material.

  • still frame from Floating Rates: Benchmark Rates


    Interest in Lending

    A discussion of interest in the lending context, including fixed and floating interest rates, how interest is calculated, and interest rate swaps. And a look at LIBOR and how LIBOR is being eliminated as an index for floating rate loans.

  • Icon of a document


    Interest in Lending


During the Session

Part 1: Knowledge Check
Ask attendees these questions to ensure they understand the topic:
  • What’s the difference between a fixed rate and a floating rate? How are floating rates calculated?
  • Why do LIBOR-based loans maturing after June 2023 need a “backup plan”? In the meantime, what do LIBOR loans’ interest rates look like over the life of a loan? 
  • Do loans with PIK interest use compounding interest or simple interest? Why would a borrower agree to PIK interest?
  • What are basis points? How many basis points would be equal to 5%? 
Part 2: Group Exercise
Lead a group discussion based on the exercise. To encourage collaboration, divide the attendees into groups to discuss the exercise, then have a representative from each group summarize their views to the larger group. Call on people to share their thoughts and ask others to respond.
Tip for remote sessions: use your web conferencing system’s breakout room feature to divide people into groups.
Part 3: War Stories and Firm Specifics
Share your own experiences and guidance, including:
  • Anecdotes and war stories (e.g., about a near-disaster or a tough negotiation)
  • General practice tips (dos and don’ts)
  • Firm-specific guidance and practices 

After the Session

To continue their learning, attendees can check out related courses in Hotshot’s Commercial Lending topic.

About Hotshot

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