5.3 Manual Netting

This topic provides the systematic instructions to capture the Manual Netting details.

  1. On the Home page, type TRDMNNET in the text box, and click next arrow.

    Foreign Exchange Manual Netting screen is displayed.

    Figure 5-6 Foreign Exchange Manual Netting


    Description of Figure 5-6 follows
    Description of "Figure 5-6 Foreign Exchange Manual Netting"
  2. On the Foreign Exchange Manual Netting screen, specify the details as per the requirement to initiate manual netting of FX contracts.

    For information on the fields, refer to the below table.

    Table 5-8 Manual Netting- Field Description

    Field Description

    Branch Code

    Default Current Branch as required.

    Sequence Reference Number

    A Unique Reference Number will get generated on initiating a Manual netting.

    Customer

    The adjoining option list displays the customer number of the customer for whom you wish to initiate manual netting. Choose the appropriate one.

    Choose customers whose marked contracts have auto netting. If you choose to net the contact of an auto netting customer manually, an override displays prompting you for confirmation. On confirmation, you allow initiating manual netting.

    Customer Name

    This field displays the customer name.

    Currency

    This specifies a list of various currencies for which contracts were booked for the above customer and which requires netting. Currency-wise netting will then be carried out for the chosen currency. The user can specify a value of 'ALL' for the currency.

    If the currency was specified then the system will pickup all contracts having same bought or sold currency where the respective value date is less than or equal to the netting date and which requires netting. If the currency is selected as 'ALL', then all contracts for the customer will be picked up.

    System will create separate Netting Reference number for each Currency.

    Currency Pair

    The adjoining option list displays a list of all currency pairs that the specified customer has dealt which also require to be ‘netted’. Specify the pair for which you wish to initiate manual netting. Alternatively, you may specify ‘All, All’ as the currency pair whereby all the currency pairs in which the customer has dealt with will be chosen for manual netting. Choose the appropriate one.

    If you have specified a currency for manual netting, the system will pick up all contracts of the customer having the particular bought or sold currency whose value date is less than or equal to the netting date and which requires netting. If you have selected currency, ‘All’, all the contracts of the given customer will be chosen.

    While initiating the manual netting process:

    If you have chosen a currency pair, the system will pick up all the contracts having the same currency pair that requires netting. If you have specified the All, All as the currency pair, all the contracts for that customer will be picked up for manual netting.

    Note: If currency All or currency pair All, All has been chosen, an override will be displayed, to confirm whether netting needs to be performed for all the currencies.

    Currency/ Currency pair, Netting deal type is defaulted from netting agreement. User can modify the only the Netting deal type value while initiating a manual netting.

    User can initiate multiple manual netting for the same customer on the same day.

    Fetch Button is provided. Once chosen the parameters the user can click on the fetch button, which will retrieve all the contracts in the selection criteria.

    Once the Contract is fetched and displayed for Netting no other user will be allowed to select this deals for Netting.

    Following checks will be done in selecting the Contracts for Netting
    • Non netted Contracts are allowed to be selected for netting. That is, only those contracts that do not belong to the status “both bought and sold netted” will be netted.
    • NDF deal also should be selected for netting if the NFIX deal is present and vice versa.
    • CLS Contracts will not be picked up for the netting.
    • Leg Net - This field will display the Leg Netted. The field will have two Values - Bought and Sold. For NDF deals, this field will be Null.
    • Contract Reference Number - The field will display the Contract reference considered for netting.
    • Bought Currency - This field displays the bought currency of the contract
    • Bought Amount - This field displays the bought amount of the contract

    Netting Select

    This specifies whether to pickup only the deals belonging to the specified customer or all the deals belonging to the entire customer group.

    This is a drop down field which will list 2 values - All and Customer.

    If the Netting select option for the customer is ALL then all the contracts belonging to this entire customer group (Primary and secondary) will be fetched for Netting.

    If the Netting select option for the customer is Customer then the deals belonging only to this customer will be fetched for netting.

    The secondary customer deal will not be included for netting.

    Value Date

    This is a Date field. Based on this date contracts are fetched for netting. which will display the current application date.

    Agreed By

    This should be a drop down with possible values as Phone, FAX, and In Person. Default value on this field will be Phone.

    Agreed Text

    This is a free format field to capture user comments on the netting agreement. Maximum length of the field is 100 characters.

    Netting Deal Type

    Select netting deal type from the drop-down list. Following are the options available:

    • Spot Deals: Only spot deals are considered for netting
    • Forward Deals: Only forward deals are considered for netting.
    • NDF Deals Only: Only NDF deals and corresponding fixing deal are considered for Netting.
    • Non-NDF Deals Only: Non NDF, i.e. spot and forward deals are considered for Netting.
    • All Deals: All deals are considered. By default, this option is selected.
    • Split Netting: Netting is done based on the product wise, namely, Spot, Forward and NDF separately. The External Payment System creates separate payment contracts based on these products.
    • Net NDF/Non NDF: Netting is done for NDF and Non NDF (Spot and Forward) separately. The External Payment System creates separate payment contracts both NDF and Non NDF contracts

    Note: This field value gets defaulted from Netting Agreement Maintenance. User can modify the value while initiating the manually netting.

    Netting Status

    Netting status is provided. Status will have two values Netted and not netted.

    This netting status is for the Reference number

    This will get updated once Intraday batch or EOD netting batch
    Deal Details
    • Bought Value Date - This field displays the bought value date of the contract
    • Sold Currency - This field displays the sold currency of the contract
    • Sold Amount - This field displays the sold amount of the contract
    • Sold Value Date - This field displays the sold value date of the contract
    • Deal Rate - This field displays the deal rate of the contract
    • Settlement Amount - This field will display the Settlement amount of the NDF deal. This will display only for NDF deals for other deal types it should be Null
    • Settlement Currency - This field will display the Settlement currency in which deal is settled. This will display only for NDF deals for other deal types it should be Null.

Parent topic: Processing of Contract