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IC Loans (Intercompany Lending)

Overview

Intercompany loans are financing arrangements between entities within the same corporate group. Unlike external debt from banks, IC loans involve internal lending from one subsidiary to another or from parent to subsidiary, with associated interest rates, repayment terms, and transfer pricing considerations.

For treasury teams, IC loans are a key tool for liquidity management - getting money into a country or subsidiary with the ability to pull it back, while keeping transactions within arm's length requirements. Managing a portfolio of 60+ IC loans across multiple currencies and jurisdictions is common for large multinationals.

For detailed ICP context and terminology, see fundamentals.md

Top Jobs & Desired Outcomes

Full history: jobs.md

1. Track intercompany loan positions and interest across multiple entities ✓

Desired Outcomes: - Minimize manual effort to update benchmark rates and calculate interest monthly - Reduce errors in interest accrual calculations - Increase visibility into total IC loan exposure by entity and currency

Sources: Palm Internal, ON (Confirmed)

2. Manage IC loan lifecycle (issuance, amendments, repayments, closure) ⚡

Desired Outcomes: - Minimize risk of missing loan maturity dates requiring amendments - Reduce time spent on loan documentation and amendments - Increase ability to identify loans that can be paid down when cash is available

Source: Palm Internal (Emerging - needs external corroboration)

3. Provide accounting teams with accurate IC loan data for booking ⚡

Desired Outcomes: - Minimize reconciliation issues between treasury loan tracking and accounting entries - Reduce time for accounting to confirm loan draws against bank movements - Increase accuracy of intercompany loan reporting

Source: Palm Internal (Emerging - needs external corroboration)

Key Pain Points

Full history: pain-points.md

  • Manual benchmark rate updates - Pull rates from Bloomberg monthly, update spreadsheet (Source: Palm Internal)
  • Complex interest calculations - Floating rate + spread, calculated monthly on outstanding principal (Source: Palm Internal)
  • Loan maturity tracking - Need alerts for loans expiring soon (Source: Palm Internal)
  • Kyriba IC loan module unusable - "Complete mess", no one wanted to use it (Source: Palm Internal)
  • Thin capitalization tracking - Can't figure out how to track debt-to-equity limits properly (Source: Palm Internal)

Key Opportunities

  • Simple loan tracking - Borrower, lender, amount, rate, interest owed/paid
  • Automated benchmark rate updates - Pull rates automatically, calculate interest
  • Maturity alerts - Notify when loans approaching expiration (e.g., 30 days out)
  • Accounting integration - Generate reports for loan booking confirmation
  • Credit facility tracking - Track borrowed amount vs notional limit

Open Questions

  • [ ] What benchmark rates are most commonly used by currency?
  • [ ] How do customers currently handle thin cap tracking?
  • [ ] What's the typical loan amendment workflow?

Last updated: 2026-02-02 | Sources: [3] transcripts (view all)