Article 1961.

Usurious contracts shall be governed by the

Usury Law and other special laws, so far as they are not

inconsistent with this Code.

WHY SHOULD THERE BE A PROVISION ON THE PURPOSE

WHEN IT IS ONLY THE CONCERN OF THE BORROWER?

It is the risk-management tool of the lender. The lender wants control.

They want it to go the business or stated purpose. This is one way of

ensuring payment.

WHAT IS A COMMITMENT FEE?

The bank being part of the syndicate, you have to pay the fee. This is

similar with the participation fee.

WHAT IS THE CLAUSE WHEREIN THE BORROWER WOULD

SHOULDER ALL FEES? AN EXAMPLE OF THIS IS FUNDING AND
YIELD PROTECTION.

This is to ensure that the banks would profit from the loan

agreement.

DRAWDOWN DATE
 Date of giving of the money.

WHY IS THE TREASURY BILL RATE DENOMINATED AS 91-DAY,

182-DAY?

It is because it is divisible by 7 and in a public auction, it would fall on

a business day. Another trivia, if it is for more than one year, it is

called Treasury Bonds. If it is longer than that, it is called Cash

Management Bonds.