5.2.4.4 Specifying Repayment Schedule Details

The repayment schedule definition for the drawdown is based on the repayment processing rule specified at the tranche level. The available rules are:

• FIFO (First In First Out)
• Pro-rata
• LIFO (Last In First Out)

For more information on the above rules, refer the heading Specifying processing rules for the tranche in this chapter.

Further, it also depends on the Auto Repay Schedule option defined for the tranche (in the Schedule tab of the LB Tranche Contract Online screen).

• If this option is selected, the rule specified at the tranche level is applied for defining the repayment schedules for the drawdowns processed under the tranche. In this case the Principal Schedule Definition is marked as AUTO (in the Schedule Details section of the Schedule tfab) and you cannot change it. However, you can amend the schedules, if required. If amendments are made, auto scheduling does not happen for further drawdowns.
• If the option is not checked, the schedules defined for the DD product is applied for drawdowns under the tranche. For such drawdowns, the Principal Schedule Definition is marked as MANUAL (in the Schedule Details section of the Schedule tab) and you cannot change it. In this case also, you can amend the schedules, if required. However, if you make amendments, auto scheduling does not happen for further drawdowns.

Note:

The drawdown repayment schedules are determined by the reduction schedules only for drawdowns with the following attributes which are defined as part of drawdown product preferences.

• Payment Type - Bearing
• Schedule Type – Normal

The repayment schedule details include the following:

Table 5-4 Repayment Schedule Details

Fields	Description
Type	In the Schedule Details section of the screen, you can define the following types of schedules: P: Repayment schedules R: Interest rate revision schedules (for interest components of type Floating and Periodic) F: Interest rate revision schedules (for interest components of type Fixed)
Component	In this field, you have to specify the component for which the schedule is being defined. All components - the principal and other components, depending upon your association with the drawdown product will be available in the form of an option list. You have to define schedules for each of them. When defining repayment schedules for specific loans, the amount of repayment needs to be specified only for the principal. The interest, commission and fee amounts are calculated by the system, automatically, depending on the repayment date and amount of the principal. Note: For amortized schedules, you cannot define schedules for the principal. The component is displayed as AMORTISE. You should specify the frequency of amortization.
Start Date	This is the date on which the first repayment or rate revision becomes due for the schedule being defined. Subsequent dates will be calculated based on this date and the frequency you specify in the next field. Any repayment or rate revision schedule date falling on a holiday is handled as per the holiday treatment specifications you define. This date should be the same or later than the Value Date and same or earlier than the Maturity Date of the drawdown.
No.	Based on the frequency and the unit of frequency, you have to specify the number of schedules for the component. For instance, if you want the schedules to fall due once a month for 12 months, then you need to specify the following details: Frequency: Monthly Unit: 1 No: 12
Frequency	This indicates the frequency/interval at which the schedules fall due. The available frequencies are: Daily Weekly Monthly Quarterly Half-yearly Yearly Bullet: One bullet schedule is automatically defined for each component based on the drawdown available amount. Note: You can specify only bullet schedule for PIK interest component. PIK margin maintained at the Margin Maintenance screen is automatically picked up for the PIK margin component.
Unit	Unit of frequency identifies the number of occurrences within a frequency, for example, . Unit 2 and Frequency Monthly means bimonthly frequency that is, the schedule occurs once in 2 months. Similarly, if you want a payment every 15 days you have to specify the frequency as Daily and enter the units as 15.
Amount	When defining repayment schedules, the amount of repayment needs to be specified only for the principal. This is the amount by which the available amount under the drawdown is reduced as per the frequency. The system calculates the interest and fee amounts automatically, depending on the repayment date and amount of the principal. However, for drawdowns with special interest, you also have to provide the interest amount. Similarly, if a fee or a charge has been defined as an amount, you also have to specify the amount. Note: If you specify amortized schedules, the system automatically does the amortization according to the frequency that you have defined. You can define as well as redefine Back Value dated Interest Schedule while amending the schedule for the Drawdown contract. You can specify Back Value dated Interest Schedule only for unliquidated Interest Schedules. You are allowed to change the Interest schedule beyond the last interest liquidated schedule. For Prime drawdowns, you will not be allowed to define a new or redefine an existing interest schedule beyond the last Interest/Principal prepayment date.
Month End Indicator	If Month End Indicator is selected as Yes then ensure to enter the Start Date as month end. In this case you need to consider Holiday Treatment For Schedules. If you select Consider Branch Holiday (Move forward/Move backward) then you need to select any of the following options. Move Across Month Move Payment Schedules Move Revision Schedules Cascade Schedules If you select Ignore Holidays you need not select any of the above options. Holiday currency is based on the currency maintained in the Currency Maintenance screen.