This chapter contains the following topics:
2)Navigate to the Schedule Definition Screen
5)Upload the Contracts for Amendment
Any change to the terms of a Money Market deal, which affects its financial details and the accounting entries, is made through the Value Dated Changes function of Oracle Banking Treasury Management. Through this function, you can make changes to authorized deals on any day before the Maturity Date of the deal.
The changes to the terms of a deal notified through this function, take effect on a date referred to as the “Value Date”. That is why the changes brought about by this function are called Value Dated Changes.
A Value Date could be:
•Today
•A date in the future
•A date in the past
Using the Value Dated Changes function, you can make changes to the various components of a deal like the interest rate or amount. You can also change the Maturity Date and the Credit Line to which the deal is linked. In addition to changing the values in certain fields, you can enter a value into a field, which was not used, when you captured the money market details.
For example, you may not have specified a fee at the time of deal input. Using the Value Dated Changes function, you can specify the fee so that the fee entries are passed on the Value Date.
When you make a value dated change, only the accrual entries is passed by the Value Dated Changes function. The Automatic Contract Update function passes all the other accounting entries. The Value Date is the date on which the changes that are going to be defined will take effect. This is a date earlier than today, today, or a date in the future. If the value date is a date in the past, it should not be beyond the following dates for any component:
•Last payment date
•Last schedule date
Also, a value date in the future cannot be beyond the Maturity Date of the deal. If it has to be beyond the Maturity Date of the deal, you have first to postpone the Maturity Date of the deal so that your proposed future value date falls before the new maturity date. Only after this change is authorized can you fix a value date in the future for the deal.
The system defaults to today’s date. In the Application Browser, click MM. Under this, you will see MMVD Amendments. Click on this and the Value, Dated Amendments screen, is displayed. Enter the reference number of the deal to which you want to make amendments.
The main details of the deal are displayed on the screen.
7.2 Navigate to the Schedule Definition Screen
The schedule changes, which have come about as a result of value-dated changes is done through the Value Dated Amendments screen. For example, if the schedule change comes about the following change in the maturity date, or the interest rate, you have to do this through this screen. Click Schedules on this screen.
This topic contains the following:
2)Make Changes in the Credit Line
7.2.1 Change the Maturity Date
Enter the new Maturity Date on the screen. When you change the Maturity Date of a deal:
•If you have advanced the Maturity Date, the schedules falling due after the new Maturity Date is redefined to the Maturity Date.
•If you have postponed the Maturity Date, the schedules that have not liquidated and which fall due before the new maturity Date is redefined to the new Maturity Date.
You have to authorize the change in Maturity Date, before you redefine the schedules as per your new requirements, through the Contract Schedules screen.
When you extend the Maturity Date of a deal, the time code of the credit line to which the deal is linked should be beyond the new Maturity Date. If not, the system will seek an override.
The new Maturity Date applies to the deal from the Value Date of the deal.
7.2.2 Make Changes in the Credit Line
When you make changes in the Credit Line, the Central Liability tracking for the deal is done against the new line. The Value Date and Maturity Date has taken into consideration during the time code calculation of the deal.
7.2.3 Make Changes in Interest
If you want to make value dated changes in the interest rate, the rate code, the spread or the interest amount you have to invoke the Contract Interest, Charge and Fee screen of the ICCB module through the Value Dated Changes screen. You can make value dated changes only to the following components in the Contract ICCB screen:
Interest Rate
Enter the new interest rate. However, you will not be able to:
•Change the interest rate if you have defined zero-interest for the deal
•Change the interest type
Rate Code
If a floating type of interest is defined, enter the new rate code.
Spread
Enter the new spread here.
Interest Amount
Enter the new interest amount.
Acquired Interest
If the deal initiated when it was input, the interest amount that has been accrued is entered here. The amount is taken into account by the system during the next liquidation cycle. You can make changes to the acquired interest through this screen.
Waiver
The attributes of an interest component are defined for a product is applied to a deal involving the product. If for some reason you do not want to apply the interest component for the deal you are processing; you can do so by checking this field. The interest is calculated, but it is applied on the deal.
note: For back valued changes in interest rate, the system will take corrective action. Accruals are redone till the last accrual date. Also, in case of a back valued change, the value date should not be beyond the last liquidation date.
Context:
To make changes to the Settlement Accounts and the currency conversion rates, you will have to invoke the Contract Input screen and go to the Settlements screen by clicking the Settlements button.
Prerequisite:
From the homepage, navigate to Money Market valued dated Changes Input screen.
1.On the Money Market valued dated Changes Input, click Settlement.
Step Result: Settlement Details screen is displayed.
Figure 7.1: Settlements Details
note: For details on settlement instructions, please refer to the Settlement chapter in the Modularity User Manual.
7.4 Delete Value Dated Changes
You can delete the value-dated changes that you have made on a deal provided:
•The change is yet to be authorized; and
•The change has not yet been affected (in case of a future value dated change)
All the value-dated changes are authorized before the End of Day operations begin.
All the future valued dated changes are applied by the automatic contract update program when the changes become due. If the value date of the change is earlier than or the same as today’s date, the changes are applied immediately.
To delete value-dated changes, call the deal on which you have made value dated changes (that are still to be authorized) through the Value Dated Changes screen by entering the reference number. The details of the contract is displayed. Choose delete from the Application toolbar or click ‘Exit’ or ‘Cancel’ button on the toolbar. The value-dated changes are deleted.
7.5 Upload the Contracts for Amendment
From an external system, you can upload contracts that require amendment in Oracle Banking Treasury Management. The system will distinguish between the new and the contracts that require amendment based on the action code of the uploaded record. For a contract requiring amendment, the action code is ‘AMND’. If the action code is ‘AMND’, Oracle Banking Treasury Management will first check whether the contract exists in the system or not. If the contract does not exist in the system, an error message is displayed to notify that the contract is not amended.
The Reference Number provided by the external system has to same if it is a new contract or if it is an amendment to an existing contract.
When you upload a new contract, the Reference Number is displayed in the User Reference Number field for that contract. The User Reference Number is basis for checking whether the contract exists or not.
The upload for contract amendment will trigger the ‘CAMD’ event. The same event is triggered even when you amend the ‘MM Contract Online’ screen.
The fields amended for the Money Market module are as follows:
•Holiday Currency
•Move Forward
•Move Payment Schedules
•Move Revision Schedules
•Receivable tracking Parameters
•Liquidation – Auto/Manual
•Internal Remarks
•Demand Basis
•Schedule Details
•Settlement Details
The amendments of the following fields considered as a financial amendment:
•Currency
•Counterparty
•Amount
•Booking Date
•Value Date
•Cr/Dr Branch Code
•Cr/Dr Account Number
•Holiday Currency
•Commitment (Revolving/ Non- revolving)
•Maturity Type
•User Input Maturity Date
•Broker
note: In case the request is a financial amendment, then the contract is reversed and rebooked. If it is a non-financial amendment, then the normal amendment procedure is followed, and the version number is changed, each time the contract is amended.
In the case of financial amendment, Settlement Instructions requires special handling.
note: If the request received has settlement details, then the values sent as part of the upload should be uploaded.
If Settlement Details are not sent, then the details corresponding to the parent contract is copied to the child contract (if they are not specified at the time of creation).
If the request is a financial amendment, then the contract is reversed and rebooked. If it is a non-financial amendment, then the normal amendment procedure is followed, and the version number is changed each time the contract is amended
However, if the SGEN message is already generated then financial amendment upload is not allowed.
Reverse and Rebooking Contracts
While reversing and rebooking the parent contract details including the subsystems are copied to a new contract, and the parent is reversed, and the screen is in the new mode so that any details of the contract is changed. It is validated that no payment messages have been sent for the Reversed FCC ref no. A configurable override is displayed. If the payment messages are generated, then the Cancellation request messages (REVSWIFT) are generated. At the branch parameters maintenance, the option ‘User Ref No in Messages’ should be checked.
The user reference number and the external reference number of the parent contract number are copied to the new contract. Deletion of the new contract will delete the reversal of the parent contract and set the value of user ref number and external ref number in the parent contract from the child contract. Authorization of the new contract will authorize the parent contract. It will not be possible to delete or authorize the reversal of the parent contract reference number without deleting or authorizing the child.
You can maintain the type of confirmation in the MM Contract Confirmation screen. The option list displays all open and authorized MM contracts. The Confirmation message of the parent message is suppressed if the counterparty of the parent contract and the current contract are the same. In case the counterparty of the parent and child are the same, then in case the parent contract is confirmed, then the child will also be marked as confirmed. If the parent is not confirmed, then it is marked as confirmed, and the incoming confirmation is matched with the child contract.
Context:
Authorize the value dated changes based on requirement, using the Authorize screen.
Prerequisite:
From the Homepage, navigate to Money Market Valued Dated Changes Input screen.
1.On the Money Market Valued Dated Changes Input screen, choose a contract entry and click Authorize.
Step Result: Authorization screen is displayed.
Figure 7.2: Authorization
2.On Authorize screen, specify the details as required.
3.Click Ok to authorize the contract OR Exit if you do not want to authorize the contract.
If the contract involves a product for which some Re-key fields have been defined, the details of the contract is displayed after you input the values in those fields. If no Re-key fields have been defined, the details of the contract are displayed in the ‘Authorization’ screen.
All the overrides are given during the operation is displayed when the contract is being authorized.
If you are authorizing an amendment, the old values are replaced by the amended values, which is available for subsequent processing.
After the contract is authorized, the accounting entries passed during this stage is marked as authorized and advises, if specified for operations generated.