Prepayment rules allow you to specify methodologies to model the loan prepayment and deposit early redemption behavior of products in your portfolio and quantify the associated prepayment risk in monetary terms. For more information, see Defining Prepayment Methodologies section.
The methodologies contained in the Prepayment rule are referenced by Transfer Pricing and BSP Processes.
The procedure for working with and managing the Prepayment rule is similar to that of other Oracle Balance Sheet Planning business rules. It includes the following steps:
· Searching for Prepayment rules.
· Creating Prepayment Rules
· Viewing and Editing Prepayment rules.
· Copying Prepayment rules.
· Deleting Prepayment rules.
As part of creating and updating Prepayment rules, you can also define prepayment methodologies for all relevant product / currency combinations. For more information, see the following sections:
· Defining Prepayment Methodologies
· Defining the Constant Prepayment Method
· Defining the Prepayment Model Method
· Defining the PSA Prepayment Method
· Defining the Arctangent Calculation Method
· Associating Conditional Assumptions with Prepayment Rules
Oracle Balance Sheet Planning provides you with the option to copy, in total or selectively, the product assumptions contained within the Prepayment rules from one currency to another currency or a set of currencies or from one product to another product or a set of products. For more information, see Associating Conditional Assumptions with Prepayment Rules section.