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:
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:
|
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
- 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.
Parent topic: Capturing Split Re-Price Instructions