Exchange Rate
The rollover process in corporate lending consists of the following stages:
- Drawdown or Rollover Request
Systematically record the duly completed request for the new drawdown or rollover and request funds from participants (in case of syndicated loans).
- Rate Setting
Fix the interest screen rate and margin for the drawdown or rollover request.
- FX Setting
Fix the base currency rate for the drawdown or rollover request. It is applicable only if the currency is different from the facility currency.
- Drawdown or Rollover Completion
Activate the drawdown or rollover request. Eventually remit the funds to the borrower in case of a new drawdown.
Although these stages are within the same drawdown transaction, they essentially work like individual transaction or task with their own transactional rights, and Temenos Transact provides a workflow for instigating these stages and track their completion.
Depending on the credit agreement, currency and interest pricing option selected for a drawdown request, processing of these stages within the drawdown or rollover request do or do not occur on the same day.
Product Lines
The Exchange Rate Property Class is used by the following product lines:
- Facility
- Lending
Property Class Type
The Exchange Rate Property Class is an optional Property Class associated with the following types:
- DATED
- TRACKING
- VARIATIONS SUPPORTED
- ENABLE EXTERNAL FINANCIAL
- ENABLE EXTERNAL
- CURRENCY OPTIONAL
Property Type
The Exchange Rate Property Class is not associated with any Property Type.
Balance Prefix
The Exchange Rate Property Class is not associated with balance prefix and suffix.
Attributes
The following are the attributes of the Exchange Rate Property Class.
Exchange Rate
Specifies the exchange rate to be applied for the drawdown to affect the facility utilisation.
The Existing Base Ccy Rate field in the Account Property Class (originally introduced to capture the exchange rate for migrating contracts) is made obsolete and this field is referred to capture the user rate.
Depending on the On Activity and Exchange Rate Tolerance field, this field gets defaulted with exchange rate from the exchange rate.
Initiation Type
Specifies whether the Exchange Rate Fix Activity is manual or auto.
Prior Days
Specifies the number of business days before which the exchange rate needs to be fixed for an arrangement that is due for pricing.
On Activity
Specifies the valid set of activities that can inform the system to evaluate and default a new rate (if required) from the FX table.This field works in conjunction with Recalculate and specifies the activity that can default the rate from the FX table (for example, new drawdown, rollover activities)
There are other fields in the PC which the user may choose to amend, and the system should not trigger a rate fix when the user performs such an activity.
Recalculate
Specifies whether the exchange rate needs to be revised for the activity specified in On Activity or not.
Periodic Attribute Classes
The Exchange Rate Property Class is not associated with any periodic attribute class.
Actions
Individual AA.PROPERTY.CLASS.ACTION records control which Product Line it is associated with. The Exchange Rate Property Class performs the following actions:
| Action | Description |
|---|---|
| DATA.CAPTURE | Used in capturing the details while migrating from Legacy to AA. |
| ACTION | Individual AA.PROPERTY.CLASS.ACTION records control which Product Line it’s associated to. The Exchange Rate Property Class supports action. |
Accounting Events
The Exchange Rate Property does not perform any actions that generate accounting events.
Limits Interaction
Actions associated with the Exchange Rate Property Class do not have an impact on the Limits.
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