11.2.2 Specifying Interest Details

Click Interest Details button to enter interest related details and also RFR (Risk Free Rate) details. The system allows you to modify the default RFR parameters maintained at productlevel during split reprice operation. For more information on RFR, refer to Interest User Guide.

Product Component

Table 11-3 Product Component

Fields	Description
Rate Type	Select the nature of the rate for computing interest for the child contract. The options available are: FIXED SPECIAL FLOATING When you select the Rate Type, the system displays the name of the component(s), if any of the above type is associated with the product. Note: For main interest component if Rate Type is Fixed, then you can enter rate fixing details in Rate Fixing screen. In addition, you can enter the Spread and Margin Details.
Reset Tenor	This indicates the tenor for the component. The tenor of the parent contract defaults for the child contract. You can specify a different tenor for the same, if required.
Rate Code	If there are components with Rate Type as Floating, select a rate code to be applied to the child contract. The option list displays all valid rate codes maintained in the system. Select the appropriate code from this list. The system picks up the rate maintained for the selected rate code and displays it in the Base Rate field.
Interest Basis	The system defaults the value from the component at the parent contract level and you are allowed to amend the value while capturing Re-price instruction. The interest for each currency is calculated using the interest basis, which you select: 30 Euro/ 360 30 US / 360 Actual / 360 30 Euro / 365 30 US / 365 Actual / 365 30 Euro / Actual 30 US / Actual Actual / Actual 30(Euro)/365.25 30(US)/365.25 Actual/365.25 Working Days/252 Working Days/360 30SPL/360 For more information on Interest Basis, refer to Interest User Manual.
Base Rate	The base rate for the component of the child contract is displayed here. If the rate type of the component is Fixed and the Fixed Rate Type is User Input, you can amend the rate. In the case of Floating rate type, system displays the rate applicable for the selected Rate Code.

Interest Component

In addition, the system displays the following:

• Margin Rate - The sum total of the margin component values.
• Spread - You can enter the spread value in the Spread field. The system verifies the spread value is within the value maintained in the Minimum Spread and Maximum Spread of Interest Limits Detail (OLDINTLM) screen.
• Rate – The final rate that the system arrives at based on the component Base Rate, Margin Rate, and Spread that you specify.
  • Rate value is calculated as Rate = Base Rate + Margin Rate + Spread

The margin, if maintained for the interest components defined for the selected borrower drawdown product (in the Interest Definition screen), defaults in the Product Component section of the screen. The following details are displayed.

• Name of the margin component
• Margin Basis whether tranche or drawdown.
• Basis Amount Tag
• Margin Rate

Note:

You can change the default rate only for components with Basis Amount Tag as User Input.

Specifying Interest Rate Rounding Components

The Rate Rounding Rule, Rate Rounding Unit, and Rate Rounding Position values get defaulted from Interest Limits Detail screen. If required, you can change these values.

Remarks - You can capture any additional information/remarks for the split transaction.