9.4.12 Specifying the Maturity Type

The Maturity Type, which you have specified for the old loan, apply to the loan being rolledover, by default. However, you can change the Maturity Type through this screen.

If it is to be changed, you have to specify the new maturity type for the rolled-over loan. It could be:

• Fixed - This type of loan has a fixed Maturity Date. For a loan with a fixed maturity date, you enter the changed date on which the loan should be liquidated.
• Call - The Maturity Date is not fixed. The loan can be liquidated anytime
• Notice - The loan is liquidated after a certain period of notice. The number of days of notice should be specified in this screen. This is only for information purposes. Whenever a report is generated on a notice type of loan, the notice days are mentioned on it. For a loan with notice type of maturity, you have to enter the Maturity Date, once the notice is issued to the counterparty (customer).

For a loan maturing at notice, enter the notice period in days. This is only for information purposes. Whenever a report is generated on a notice type of loan, the notice days are mentioned on it. For a loan with notice type of maturity, you have to enter the Maturity Date, once the notice is issued to the counterparty (customer).

Specifying the maturity days

For fixed maturity types, you must specify the number of days to be added to the new value date of the rolled-over contract, to arrive at its maturity date.

Specifying the maturity basis

You must indicate the tenor basis upon which the maturity days specified for the rolled-over contract will be reckoned, in the Roll By field. The options are Days, Months, Quarters, Semiannuals, and Years.

If you specify the Days maturity basis, and do not specify the maturity days, the system Rounds the tenor of the original contract to the nearest maturity days basis. The rounded tenor is considered as the new tenor of the rolled-over contract.

Example

For a loan, the value date of the original contract is 1^st April 2001, and the maturity date is 15^th March 2002. The maturity basis (Roll By) option is Months, and no maturity days have been specified.

The maturity date for the rolled over contract is arrived at as follows:

Tenor of the contract = Rounded off (number of months between 15^th –March 2002 and 1^st April 2001) = 11

Maturity date of the rolled over contract = (15^th March 2002 + Tenor) = (15^th March 2002 + 11) = 15^th February 2003

If the maturity basis for the same contract would have been Months, and the maturity days is 10, the maturity date of the rolled over contract would be computed as:

Maturity date of rolled over contract = (15^th March 2002 + maturity days taken in terms of the maturity basis) = (15^th March 2003 + 10 months) = 15^th January 2003