7 Roll Over a Deal

A rollover is a renewal of a deal. Instead of liquidating a deal on maturity, you can roll it over into a new deal. The outstanding principal of the old deal is rolled over with or without the interest outstanding on it. When a deal is rolled over (renewed), it is processed in the following manner:

• The original deal is liquidated, and,
• A new deal is initiated

You can rollover a deal that you are processing provided it is allowed for the product the money market deal involves. For a product with rollover defined, specify if deals involving the product should inherit:

• The attributes defined for the ICCB components (interest, charges and fees) from the product, or
• Those defined for the initial deal. This gains significance if you changed the attributes that the (initial) deal acquired from the product. The rolled over deal will acquire the changed attributes.

In addition, you have to specify the following for a product defined with rollover:

• Whether it is to be rolled over along with outstanding interest
• Whether the interest that has been accrued on a placement is to be considered a part of the ‘utilized amount’ for the purpose of risk tracking if you are rolling over a placement with interest.
• Whether tax has to be applied on the rolled over deal
• Whether the principal of the rolled over interest should be taxed

However, when processing a deal, you can change the attributes that the deal acquires from the product. At the time of processing the deal, you can indicate if a rollover is to be automatic or manual; the maturity type (fixed, call or notice); the maturity date for a fixed maturity deal; and the notice days.

You should also indicate if:

• Only the outstanding principal is to be rolled over,
• The outstanding principal is to be rolled over with interest, or
• If a special amount is to be rolled over. (if a part of the principal and interest from the old deal has been liquidated and only the outstanding principal - with or without interest - is rolled over, it is called a special amount).

When a deal is rolled over, the new contract continues to have the reference number of the old deal. This topic contains the following:

This topic has the following sub-topics:

• Specify Rollover for a Product
  This topic describes overview of rollover, mode of rollover, and impact of liquidation mode on rollover.
• Specify Contract Rollover Details
  This topic provides the instructions to capture the Contract Rollover Details.
• Roll over a Contract Manually
  This topic describes how to roll over a contract manually.
• Process of Rolled over MM Contract
  This topic describes Rolled over MM Contract process.
• Advices for a Rolled Over Deal
  This topic describes the advices for a rolled over deal.
• Authorize a Manual Rollover
  This topic describes the authorize a manual rollover.