Covenant monitoring
Recalculate the covenant in the agreement—not a generic template.
NSight Private Credit — SBIC Edition stores agreement-defined formulas, amendments, waivers and cures alongside borrower evidence and reviewer decisions.
SBIC covenant monitoring software turns credit-agreement terms and borrower financials into repeatable, reviewed tests with traceable inputs, thresholds and history.
The operational problem
Certificates can agree with themselves and still differ from the agreement.
Borrower certificates often arrive in different formats and may omit a required figure. Amendments can change a definition or threshold. A comparison needs to preserve both the borrower’s reported result and the lender’s agreement-defined recalculation.
NSight shows missing evidence as not tested rather than silently treating an incomplete calculation as a pass.
Reviewed workflow
From source evidence to a controlled output.
- 01
Capture the agreement
Store the defined terms, formula, threshold, test frequency, amendments, waivers and cures.
- 02
Propose borrower inputs
AI proposes figures from source documents with page references; an analyst confirms or corrects them.
- 03
Compute the test
Deterministic code applies the approved agreement definition and compares it with the borrower certificate.
- 04
Approve the result
Reviewers resolve exceptions and issue a quarter-specific result with evidence and change history.
Practical example
Illustrative leverage test: 4.50× reported, 4.20× in the agreement.
If the required calculation inputs are present, NSight recalculates the ratio using the configured agreement definition and shows the result beside both figures. If an input is missing, the test is marked Not tested until a reviewer supplies or resolves the evidence.
Supported scope
What NSight does—and where people remain responsible.
- Every covenant must be configured from the governing documents and approved definitions.
- A missing input is surfaced; NSight does not infer a passing result.
- Amendments, waivers and cures remain explicit events in the audit history.
- The example values are illustrative and are not a recommendation or fund result.
Questions
Direct answers for an SBIC team.
Can software recalculate covenants from credit agreements?
Yes, after agreement terms and extracted inputs are reviewed. NSight then performs the configured calculation with deterministic code and preserves the source evidence.
How does NSight handle missing borrower data?
It identifies the missing input and leaves the covenant not tested. A person must resolve the evidence before the result can be approved.
Can NSight compare a borrower certificate with its own result?
Yes. The borrower-reported value, the agreement-defined calculation and the applicable threshold can be reviewed side by side.
Continue exploring
Related SBIC quarter-end workflows.
Next step
Start with a quarter you’ve already closed.
Choose a few borrowers and fund workpapers. NSigma reproduces the agreed outputs in NSight so your team can compare them line by line.