18  User-Defined Repricing Patterns

User-defined Repricing Patterns provide a mechanism to capture instrument repricing patterns that are too complex to be accommodated through the use of the Standard Account Table fields.

The procedure for working with and managing Repricing Patterns is, similar to that of other Oracle Funds Transfer Pricing Business Rules. It includes the following steps:

·        Searching for Repricing Patterns

·        Creating a Repricing Pattern

·        Viewing and Editing Repricing Patterns

·        Copying Repricing Patterns

·        Deleting Repricing Patterns

Searching for Repricing Patterns

Search for a repricing pattern to perform any of the following tasks:

·        View

·        Edit

·        Copy

·        Delete

·        Check Dependencies

You must have defined the Repricing Patterns to search them.

To search the Repricing Patterns, do the following:

1.     Navigate to the Repricing Pattern Summary Page. This page is the gateway to all repricing patterns and related functionality. You can navigate to other pages relating to Repricing Patterns from this point.

Figure 91: Repricing Patters Summary page

Title: Repricing Patters Summary page - Description: The Repricing Patterns Summary page is the gateway for all the repricing patterns and related functionality. You can navigate to other pages related to repricing patterns from this page. This page displays the repricing patterns that are already created. From this page, you can create a new pattern, or view, edit, delete, copy, check dependency of an existing repricing pattern.

2.     Enter the Search criteria.

3.     Enter the code or description of the pattern.

4.     Select the Search icon.

Only patterns that match the Search Criteria are displayed.

Creating Repricing Patterns

You create Repricing Patterns to capture the Repricing Behavior of instruments whose rates change according to complex schedules.

To create the Repricing Patterns, do the following:

1.     Navigate to the Repricing Pattern Summary Page.

2.     Click Add Repricing Pattern.

The Add Repricing Pattern Page is displayed.

3.     Type a code value for the new Repricing Pattern.

The code is a Numeric Internal Identifier for the Repricing Pattern. The code value must be a number between 500 and 4999 and the code value you assign to the new pattern must be unique. Also, the code must be mapped to the appropriate instrument records (ADJUSTABLE_TYPE_CD field) to connect the instrument to the appropriate pattern.

4.     Type a brief description of the pattern.

5.     Select the Repricing Pattern Type: Absolute or Relative.

The selection of the Repricing Pattern type determines the fields that are displayed in the Repricing Events Table and the information you must provide to successfully define that pattern type. See:

§       Defining Absolute Repricing Patterns

§       Defining Relative Repricing Patterns

The Add Repricing Pattern Page displays the parameters associated with the Absolute Repricing Pattern Type, which is the default Repricing Pattern Type Value. If you change this value to Relative, the system refreshes the Repricing Specifications corresponding to the New Pattern type, and any data entered previously is lost. However, a warning message is displayed when you change the pattern type. The data is discarded only after your confirmation.

Defining Absolute Repricing Patterns

The Absolute Repricing Pattern is used for instruments that are date-dependent. Each specific date is a separate event. You need to enter the month and day for each event, except for the initial event.

Figure 92: Repricing Pattern Details with Pattern Type Absolute

Title: Repricing Pattern Details with Pattern Type Absolute - Description: You use the Repricing Pattern page with the Pattern Type as Absolute to create a new Absolute Repricing Pattern by defining details such as a unique code for the pattern being created, name, description, payment type, and term specifications. This screen allows you to add new repricing patterns and also delete an existing repricing pattern.

To define an Absolute Repricing Pattern, do the following:

1.     Select Pattern Type as Absolute. This screen allows you to do the following:

§       Add Row: This allows you to add one or more Repricing Events.

§       Delete: This allows you to delete specific rows in the Repricing Events Table.

2.     Click Add Event.

3.     Enter the following details:

§       Month: In conjunction with the Day field, this drop-down menu, allows you to specify a unique month-day combination for a Repricing Event.

§       Day: In conjunction with the Month drop-down menu, this field allows you to specify a unique month-day combination for a Repricing Event.

4.     Select the Repricing Type: Flat or Indexed.

The default is Flat. If you select Indexed, the system automatically changes the fields available for entry. See Indexed Repricing.

You can change your selection of the repricing type at any point in this process. Sometimes it may cause a loss of data.

§       Flat Rate: A Flat Rate is a specific rate—it is directly input. For more information, see User-Defined Repricing Event.

To define a Flat Rate Event, select the check box for the event you are going to define and select the Define button. Notice the bottom half of the screen refreshes, displaying the required inputs. Complete the following steps on the Add Repricing Events Page:

Figure 93: Flat Repricing Pattern Detail Pane

Title: Flat Repricing Pattern Detail Pane - Description: In the Flat Repricing Pattern Detail pane, yu define the current balance in terms of maximum percentage, net rate, gross rate, and transfer rate. You must enter a valid value for at least one of these rate fields.

5.     Select Balance Tier option:

§       None: If selected, the Balance Tiered pricing is not applied.

§       Current Balance: Users can define balance tiers and associate different rates with the corresponding balance tier level.

—    Specify the required month-day combination for the event. You cannot specify a month-day combination for the first event as this row is reserved for the initial period.

—    Enter the Net Rate.

—    Enter the Gross Rate.

—    Enter the Transfer Rate.

 

NOTE:   

You must enter a valid value for at least one of these rate fields.

 

6.     Click Apply.

The Event Summary Page is displayed. Note that the status indicator has changed from Red to Green indicating that details for the event are defined. At this point, you have the option of defining additional events or saving. To add another event, repeat Step 2. If you want to save the repricing pattern and events, advance to the next step.

Repricing Event is Indexed Repricing:

An Indexed Rate is a set of parameters used to calculate a rate. For more information, see User-Defined Repricing Event.

If you select Repricing Event as Indexed Repricing, to define the Absolute Repricing Pattern, do the following:

1.     Select the check box for the event you are going to define and select the Define button. Notice the bottom half of the screen refreshes, displaying the required inputs. Complete the following steps on the Add Repricing Events Page:

Figure 94: Indexed Repricing Event Detail

Title: Indexed Repricing Event Detail - Description: In the Indexed Repricing Event Detail pane, you select the check box above each of the columns and define the balance tiers and associate different rates with the corresponding balance tier level. You can enter the details like interest rate code, transfer interest rate code, net margin, yield curve term, gross margin, FTP margin, rate cap life, rate floor life, and rate set lag. After entering the above information, when you click Apply, the repricing pattern event is saved and the entered information is displayed in a new row. You can add another event by clicking the Click Add Event.

2.     Select the check box above each column that you want to include in the repricing event.

3.     Select a Balance Tier option:

§       None: The Balance Tiered pricing is not applied.

§       Current Balance: The users can define balance tiers and associate different rates with the corresponding balance tier level.

—    Select the Interest Rate Code.

—    Select the Transfer Interest Rate Code.

—    Enter the Net Margin.

—    Enter the Yield Curve Term and select the appropriate Multiplier.

—    Enter the Gross Margin.

—    Enter the FTP Margin.

—    Enter the Rate Cap Life.

—    Enter the Rate Floor Life.

—    Enter the Rate Set Lag and select the appropriate Multiplier.

4.     Click Apply. The Event Summary Page is displayed.

At this point, you have the option of defining additional events or saving. To add another event, repeat the Click Add Event. If you want to save the Repricing Pattern and events, advance to the next step.

5.     Click Save at the bottom of the page.

The repricing pattern is saved and the Repricing Pattern Summary Page is displayed.

Defining Relative Repricing Patterns

The Relative Repricing Pattern is used for instruments where the repricing is determined by the elapsed time since origination. Defining a Relative Repricing Pattern involves the definition of a series of repricing events applicable to a specific Repricing Pattern Code. You need to specify the length of each Repricing Period and the number of times that event should occur before calculating the next event in the pattern.

Figure 95: Repricing Pattern with Patter Type Relative

Title: Repricing Pattern with Patter Type Relative - Description: A Relative Repricing Pattern is used for instruments where the repricing is determined by the elapsed time since origination. The Repricing Pattern page with the Pattern Type as Relative is used to create a new Relative Repricing Pattern by defining details such as a unique code for the pattern being created, name, description, frequency, multiplier, repeat, repricing type.

The steps to create relative repricing patterns are similar to creating Absolute Repricing Patterns.

The only difference is that the fields in the Repricing Events Table are different.

Select Pattern Type as Relative. This page allows you to do the following:

·        Add: This allows you to add one or more Repricing Events.

·        Move Up: This allows you to move a particular row up by one position. This action for the first and second rows is not active.

·        Move Down: This allows you to move a particular row down by one position. This action for the first and last rows is not active.

·        Delete: This allows you to delete specific rows in the Repricing Events Table.

You need to specify the following parameters in the Repricing Events Table for a Relative Repricing Pattern:

·        Frequency: In conjunction with the Multiplier drop-down menu, this field allows you to specify how often repricing occurs.

·        Multiplier: The unit of time applied to the frequency. The choices are:

§       Days

§       Months

§       Years

·        Repeat: This allows you to specify the number of times a Repricing Event should be repeated.

·        Repricing Type: A drop-down list, displays the Repricing type, Flat Rate, or Indexed Rate, associated with a particular event.

After defining the above details, click Define. The Event Summary Page is displayed. Note that the status indicator turns from Red to Green indicating that details for the event are defined.