3.2.3 Collateral Agreement preferences

User can override some of the specific preferences for the Collateral Agreement at the contract level.

Click the Collateral button at the bottom of the Collateral-Netting screen to open this screen.

Figure 3-4 Collateral Agreement preferences

Description of "Figure 3-4 Collateral Agreement preferences"

The following table describes the fields captured for Collateral agreement preferences for a Contract.

* Indicates mandatory fields.

Table 3-5 Collateral Agreement preferences

Field	Description
Module	Displays Treasury Module of the contract.
User Reference	Displays User Reference number of the Contract for which the Collateral-Netting preferences are being captured.
Version	Displays current Version of the contract.
Agreement	Displays the selected Agreement.
Margin Type	Displays the Margin type selected.
Margin Code	Displays the Margin code selected.
Margin Currency	Displays the margin currency selected.
Collateral Party	Displays the contract party of the agreement.
Pledgor/Receiver	Displays Pledgor/Receiver as selected in Linked Entities sub system for this contract.
Margin Preferences	Group of fields to capture the contract level overrides for the preferences to be used for collateral margining.
Offset Exposure	Indicate whether exposure of this contract can be offset against exposure of other transactions linked to the same agreement, to arrive at the net exposure for margin calculation purposes for this margin code. This field cannot be amended after first authorization of the contract
Collateral Reuse Allowed	Indicate whether the collateral exchanged for this contract can be reused for settling or repledging for other contracts booked by the receiver. This field cannot be amended after first authorization of the contract
Net Settle Collateral	Indicate whether the collateral exchanged for the contract is net settled with other components or with other contracts.
Securities Collateral	Group of fields to capture the contract level overrides for the preferences to be used for securities collateral provided.
General Collateral	Indicate whether the securities can be assigned from a general collateral pool of eligible securities provided by the pledgor, for this margin code Applicable only if “Securities” collateral is allowed for this margin code in the Agreement This field cannot be amended after first authorization of the contract If checked, then the securities decided by the agreement party are assigned, at the end of the day, to the extent of the margin required for the transactions linked to the agreement Need not assign any specific securities, while booking the transactions If unchecked, then specific securities should be assigned separately while booking the contract
Deliveries By Value	Indicate whether the securities can be assigned by the Triparty Agent/Third party from a general collateral pool of eligible securities provided by the pledgor, for this margin code Applicable only if agreement type selected is ‘Triparty’, ‘Securities’ collateral is allowed, and General Collateral is checked for this margin code in the Agreement This field cannot be amended after first authorization of the contract If checked, then the collateral securities assigned by the Third-party custodian at the end of the day, automatically returns at the beginning of the next day If unchecked, then collateral assigned will not be automatically returned the next day
Cash Settlement Schemes	Select the list of settlement schemes to be used for transferring cash collateral, for this margin code. These fields are applicable only if “Cash & Deposits” are allowed as collateral, for this margin code in the Agreement At least one default scheme should be defined with Exposure Currency selected as ‘ALL’
Exposure Currency	Select the currency in which exposure is calculated for the contract for this margin code. Normally same as the contract currency selected for the contract If not specified, ‘ALL’ is set by default
Settlement Scheme	Select the settlement scheme through which the cash collateral is exchanged for the exposure in the selected exposure currency, for this margin code. Same settlement scheme can be used for multiple contracts, margin accounts and margin codes If this field is amended after authorization, any changes to the management of collateral already transferred should be operationally handled and will not be automatically modified by the system
Scheme Description	Displays the description of the Settlement scheme.
Scheme Currency	Displays the currency of the settlement scheme, in which the settlement happens. If the Scheme Currency is different from the Margin (Account) Currency, then the component amount to be settled is converted into Scheme Currency equivalent, using the prevailing FX rates, as configured for the Settlement Scheme
Margin Account	Select the cash margin account, linked to the selected settlement scheme, in which the cash collateral is tracked for the margin calculated in the account currency, for the exposure in the selected exposure currency, for this margin code All cash collateral linked to the same cash margin account is tracked together Interest is calculated on this cash collateral according to the configuration in the margin account
Account Description	Displays the description of the cash margin account.
Account Currency	Displays the currency of the cash margin account, in which cash margin is tracked. Normally same as the margin currency selected for the margin code If the Account Currency is different from the Exposure Currency, then for the purposes of calculating the margin required (or available), the exposure is converted into Account Currency equivalent, using the prevailing FX rates, as configured for the agreement
Account Type	Displays the type of the cash margin account. Can be a Current Account maintained by the customer with the bank Can be a Nostro Account maintained by the bank with the collateral party Can be a Deposit Account defined for this purpose Can be a General Leger (GL) defined for this purpose
Default	Indicate the default settlement scheme and margin account to be used, for the exposure calculated in currencies not setup separately.

Click the Default button to populate the Cash Settlement Schemes in the selected agreement for the exposure currencies of this contract