15.12 Processing Manual Trade Settlement

After the successful processing of Trade Closed Notice message, Oracle Banking Corporate Lending allows you to manually initiate the SLT trade settlement. If the closure message is processed, then you can select the ‘Process Settlement’ check box in the ‘Trade Settlement Queue’. If you check this box, then you can overwrite the fee amount in the ‘Funding Memo’ screen. on saving the trade, the FMEM/TSTL is registered.

System allows you to delete the FMEM/TSTL events and on deletion, the events are accounting entries are deleted. The record remains unchanged in the ‘Trade Settlement Queue’. On successful authorization, the events and accounting entries too get authorized. The appropriate settlement status is then updated in the ‘Markit Interface Browser’.

The required SSI maintenance should exist for the trade to process the settlement successfully. The SSI enrichment is not allowed from the Trade Settlement Queue.

If a trade is manually settled using the ticket/trade settlement screens, then the match status is updated as ‘Unmatched’ and you cannot initiate settlement for such trades from the queue.

The funding memo generated from Oracle Banking Corporate Lending and the subsequent settlement is based on Oracle Banking Corporate Lending calculations. If you override the ‘Suppress funding Memo’ message in the settlement queue marking it as ‘Yes’, then the funding memo advice is not sent to the trade counterparty. This is also applicable for ‘Suppress payment message’. For such cases, wire/payment message is not sent to the trade counterparty.

You can suppress funding memo and payment message from the Markit Trade Settlement queue only during trade settlement.

Oracle Banking Corporate Lending does not send any additional wire/payment message in case of Settlement amount/Fee amount mismatch between Oracle Banking Corporate Lending and Markit. Ticket level settlement message is then sent to LQT if the current trade under the Markit trade id is the last trade to be settled successfully for the associated LQT Ticket ID. Note that are is no notification sent to Markit for the settlement failures. You should manually correct the necessary details based on the exceptions and then can re-initiate trade settlement from the settlement queue.

The following are the generic validations for Markit trade settlement.

• No validations are done in Oracle Banking Corporate Lending for the desk code/desk type for Markit Trades.
• Markit sends only the secondary trade details where the bank is one of the trade counterparties. If the bank is a buyer in the primary trade, then the trade is considered for trade settlement and the process is similar as secondary trades. But if Trade is of type ‘Primary’ and the party is ‘Seller’, then the Trade is marked as ‘Rejected’.
• Markit sends the following notices the order listed below for a Markit Trade ID. If any trade is sent but not in the following order, then it will be rejected in Oracle Banking Corporate Lending.
  • Trade Match Notice
  • Syndicated Loan Trade Allocation
  • Settlement Details Notice
  • Trade Closed Notice
• Trade Status Update Notification message is not mandatory to be sent from Markit. But this message can be sent before Trade Closed Notice and after the Trade Match Notice/ Syndicated Loan Trade Allocation message. If not, the message is rejected.
• SLT trade settlement cannot be initiated from Markit Trade Settlement queue if the Trade Update Notification is processed in Oracle Banking Corporate Lending since this message updates the Markit Trades with one of the following statuses.
  • Suspended
  • Cancelled
  • Removed
• There is no message or acknowledgement sent to Markit for the trade rejections due to failed validations.

Note:

Manual trade settlement is initiated from the Markit Trade Settlement queue. Oracle Banking Corporate Lending sends an acknowledgement message to LQT when the last trade under a LQT ticket id is settled successfully in Oracle Banking Corporate Lending and all the other trades are already settled.