Professional Documents
Culture Documents
Loans and Deposits
Loans and Deposits
Other features
Automatic Bullet
interest Floating
schedule
Frequency Fixed
Bullet for interest
principal Periodic
Commitment Loan
Fixed Discounted
period
Fixed
Interest
Stand-alone bearing
Floating
commitment Automatic Manual
schedule schedule
Bullet
interest Periodic
Commitment Bullet
charges principal Frequency
repayment for interest
LD Dependencies
LD makes use of
CUSTOMER
ACCOUNT
Core dependencies
Delivery
Accounting
Limits
Category codes are shared with Money market module. Ranges are
hard coded
21001 - 21029 Deposit
21030 - 21039 Taking
21040 - 21044 Fiduciary Deposit
21045 – 21049 Sundry deposit
21050 - 21074 Loan
21075 - 21084 Placements
21085 - 21089 Fiduciary Placement
21090 – 21094 Account receivable
BASIC.RATE.TEXT
Floating interest
BASIC.INTEREST
Periodic interest
Bid rate is
for Deposits
Offer rate is
for Loans
Generated daily.
Back dated
changes are
also possible
LD Dependencies – Charges and Commissions
1. CUSTOMER.SSI
SPVCN Order can be changed
through ACCOUNT.PARAMETER
2. SEC.ACC.MASTER
Draw down and liquidation
Accounts can be input to be
3. AGENCY in different currency from Principal
for VOSTRO and CUSTOMER options Any preferred exchange rate
can also be input
4. CUSTOMER.CCY.ACCT
5. NOSTRO.ACCOUNT
COUNTRY REGION
HOLIDAY
CURRENCY.PARAM
CURRENCY CURRENCY.MARKET
ROUNDING.RULE Field
Type of rounding needed for interest, commission, charges and fees can
be defined here by using Id of a pre-defined rule in EB.ROUNDING.RULE
table
Natural, Rounding up, Rounding down or choice indicated in CURRENCY
are options available in EB.ROUNDING.RULE
LD.TXN.CODES
Possible to opt for monthly amortisation and also the period over which
it should be amortised, if the credit is for PL
Amortisation can be over 1 to 11 Months or 1 to 99 Annum (years) or end of
Contract or till next Rate revision
These are useful if we do not use a pre-defined record of
FT.COMMISSION.TYPE. Otherwise, accrual / amortisation rules defined in
FT.COMMISSION.TYPE are used
Use Admin Menu > Framework Parameter> Interest, Taxes & Charges
> Charges > FT Commission Type
Create a charge type to collect flat charge of USD 500
Use Admin Menu > Credit Administration > Loans > Param > LMM
Charge Conditions
Set up a record in LMM.CHARGE.CONDITIONS using a flat charge
created above
Workshop -1 Solution
Workshop -1 Solution
LD.TXN.TYPE.CONDITION
If the bank desires to use a single rate for all liquidations in a specific
currency, a new currency market may be created in order to define the
liquidation rate for each currency and indicate that in
SETTLEMENT.MARKET Field in LD.TXN.TYPE.CONDITION
Also possible to indicate whether Buy, Sell or Middle rate should be used for
these transactions in CONVERSION.TYPE Field
Value input here would be defaulted at the deal level for the relevant
category
If a rate is not input in EV.APPL.RATE in SETTLEMENT.RATES table for a
particular deal, then this rate is considered for conversion
LD.TXN.TYPE.CONDITION
Use Admin Menu > Credit Administration > Loans > LD Txn Type
Condition
Set up conditions for a loan product
Floating interest rate with a spread of 2% over base rate
Minimum and maximum principal amounts to be USD 10,000 and USD
100,000
Attach the LMM.CHARGE.CONDITIONS record created in previous
workshop
The minimum and maximum terms are to be 1 and 12 months
Create a condition for GBP loans that the interest rate should be fixed 10%.
Set interest frequency as monthly and on last date of a month
Workshop –2 Solution
LD.GROUP.CONDITION
1. LMM.ACTIVITY * * Mandatory
Optional
2. LMM.CHARGE.CONDITIONS *
(1 record mandatory for default)
3. LMM.ADVICES LMM.ACTIVITY
4. LMM.INSTALL.CONDS * LMM.CHARGE.CONDITIONS *
5. LD.TXN.CODES *
ACCOUNT.CLASS *
6. LMM.TEXT *
7. LD.TXN.TYPE.CONDITION LMM.CHARGE.CONDITIONS
8. LD.GROUP.CONDITION APPL.GEN.CONDITION
LD – Product features
Products handled
LD.LOANS.AND.DEPOSITS
Primary application to process two major activities of a bank
Loans
Deposits
Use User Menu > Corporate Operations > Loans > Create Loans >
Input Commitment
Input a Non-revolving Commitment for 5 million US Dollars available from
today for two years for your corporate customer
Banded Commission @2% on first 3 million and 1% on the balance 2
million - on the unused portion. Commission fee to commence after 2
months
Draw downs available in multiples of 1 million US Dollar
Get the record authorised
Use User Menu > Corporate Operations > Loans > Enquiries > List of
Commitments
View commitment details
Workshop – 3 Solution
Workshop – 3 Solution
Workshop – 3 Solution
Draw down from commitment
If a loan is drawn down from the commitment, limit for the Commitment
product is automatically adjusted appropriately
Hence, there is no need to create / use separate limit product for the loan
Use User Menu > Corporate Operations > Loans > Create Loans >
Loan under Commitment (Project Loans)
Input a draw down of 1.5 million from commitment created in previous
workshop
The loan is for 2 years and carries 5% fixed interest rate
Get the record authorised
Use User Menu > Corporate Operations > Loans > Enquiries > List of
Loans under Commitments
View details of Loans drawn under Commitment
Use User Menu > Corporate Operations > Loans > Enquiries > LIAB
View Limit Summary, drill down for Limit Trade Summary and further drill
down for Transaction entries.
Workshop – 4 Solution
Workshop – 4 Solution
Workshop – 4 Solution
Quiz 3 – True or False
Automatic schedule
Bullet type of payment for principal at the end
Interest at the end or in advance
Periodical frequency for Interest
Manual schedule
Frequency or zig-zag scheduling for any event
FWD, BWD, FSM, CAL and Base date key definitions needed
FIXED
Maturity date is a specific date
It can also be entered as number of days (D), weeks (W) or months (M)
from value date.
CALL/NOTICE
Maturity date is a number in the Range 0 to 999
0 = Call
1 to 999 = Number of Days Notice
1. Fixed
2. Periodic Automatic
3. Floating
4. Periodic Manual
5. Periodic Straight
Interest bearing loans can have any of the above types while
Discounted Loans cannot have Floating rates
Fixed Interest Rate
Commitments and Annuity type loans can have only Fixed Interest rate
Floating Interest Rate
Use User Menu > Corporate Operations > Loans > Create Loans >
Corporate Loans
Input a loan under the product for which you had defined rules earlier in
LD.TXN.TYPE.CONDITION in Workshop – 2
Loan 150,000 USD for 12 months at a floating rate of 3% spread over base
rate
Validate the contract, look at the defaulted values. See the effect when the
loan conditions are different from the rules set
Get the record authorised
Use User Menu > Corporate Operations > Loans > Enquiries > Loan
Schedules (Summary)
Observe how the System has defaulted Interest Repayment Frequency and
Commission
Use User Menu > Corporate Operations > Loans > Enquiries > Loan
Schedules (Full)
Look at the repayment schedule
Workshop – 5 Solution
Workshop – 5 Solution
Workshop – 5 Solution
Workshop - 6
Use User Menu > Corporate Operations > Loans > Accounting Entries
> View Transaction Entries
Look at the transaction entries for the Loan created in the previous
workshop
Drill down to view STMT.ENTRY and RE.SPEC.ENTRY detail
Use User Menu > Corporate Operations > Loans > Accounting Entries
> See Forward Entries
Look at the forward entries for the loan contract
Workshop – 6 Solution
3
Workshop – 6 Solution
Workshop - 7
Use User Menu > Corporate Operations > Loans > Create Loans >
Discounted Loan (Bills, Acceptances, etc.)
Input a loan for USD 100,000 for 1 year at 10% with discounted interest
payment type for your corporate customer
Commit the record
Open the record under EDIT mode and note down the interest amount
Make the loan as discounted interest payment type with Yield Method
While authorising, look at the effect of Yield method on the discounted
interest amount. Then get the record authorised
Workshop – 7 Solution
Workshop – 7 Solution
Workshop - 8
Use User Menu > Corporate Operations > Loans > Create Loans >
Corporate Loans
Input a call loan for USD 100,000 for your corporate customer with a floating
interest rate to which add a negative spread of 0.5 per cent
Do not give any frequency for interest payment
Get the record authorised
Use User Menu > Corporate Operations > Loans > Create Loans >
Corporate Loans
Input a 10 day notice loan for USD 100,000 with a fixed interest rate of 4
percent
Give a interest payment frequency of twice a month (TWMTH)
Get the record authorised
Use User Menu > Corporate Operations > Loans > Enquiries > Loan
Schedules (Full)
Look at the repayment schedules for the above loans
Workshop – 8 Solution
Workshop – 8 Solution
Workshop – 8 Solution
Creating a manual schedule
Forward same month - Forward to next working day if in same month. If not
go back to last working day
Base Date Key is used in conjunction with the Forward Backward Key
to specify the processing of subsequent events
RATE will be used when defining a rate review schedule or defining a margin schedule
NO. indicates how many more times the event should happen with the set Frequency (4D, 3M etc)
Interest and Principal schedules should cover the maturity date of the contract
Workshop - 9
Use User Menu > Corporate Operations > Loans > Create Loans >
Corporate Loans
Input a loan for 1 year for USD 150,000 for your corporate customer
Interest in arrears at 7%
Manual Schedule:
Principal repayments of USD 50,000 each on 2nd commencing from
third month, 10th of sixth month and on maturity date
Interest applied quarterly
Use User Menu > Corporate Operations > Loans > Enquiries > Loan
Schedules (Full)
Look at the repayment schedule
Workshop – 9 Solution
Workshop – 9 Solution
Workshop - 10
Use User Menu > Corporate Operations > Loans > Create Loans >
Corporate Loans
Input a loan for 1 year for your corporate customer
Loan amount USD 50,000
Interest in arrears at 7% initially. The interest will be reset once in two
months with a spread of 1% above the then prevailing rate in
PERIODIC.INTEREST
Interest is payable once in 15 days
Manual Schedule for Principal repayments of USD 5,000 per month to
commence after three months
Get the record authorised
Use User Menu > Corporate Operations > Loans > Enquiries > Loan
Schedules (Summary)
Look at the repayment schedule
Workshop - 10 Solution
Workshop - 10 Solution
Workshop - 11
Use User Menu > Corporate Operations > Loans > Create Loans >
Corporate Loans
Input a loan for 1 year for your corporate customer
Loan amount USD 50,000
Interest in arrears at 7% initially. The interest will be manually reset after
third and sixth months with a margin of 1% above the rates for different
periods – agreed now itself as 5% for three month rate and 8% for six month
rate
Interest is payable once in a fortnight
Principal repayments of USD 5,000 per month to commence after three
months
Get the record authorised
Use User Menu > Corporate Operations > Loans > Enquiries > Loan
Schedules (Full)
Look at the repayment schedule
Workshop – 11 Solution
Workshop – 11 Solution
Defining annuity type of schedule
Use User Menu > Corporate Operations > Loans > Create Loans >
Corporate Loans
Input two Annuity type loans for 1 year for your corporate customer
Loan amount USD 50,000 each
Fixed interest rate of 8%
Repayments on quarterly basis
Annuity Payment Method
For first Loan – BEGIN
For the second loan – END
Use User Menu > Corporate Operations > Loans > Enquiries > Loan
Schedules (Full)
Look at the repayment schedules for both loans
Workshop – 12 Solution
Workshop – 12 Solution
Workshop – 12 Solution
Online payment in contracts
Changes
Increase / decrease in Principal possible
Effected through AMOUNT.INCREASE and AMT.V.DATE Fields
Interest Rate and Spread can be changed
Effected through NEW.INTEREST.RATE and NEW.SPREAD Fields
Commission rates can be changed
Effected through NEW.COM.RATE Field
Workshop - 13
Use User Menu > Corporate Operations > Loans > Maintain Loans >
Amend/Reverse – Loans
Pick out a contract opened earlier in workshop 9
Increase Principal by USD 50,000 and reduce interest rate by 1% with
different future value dates
Use User Menu > Corporate Operations > Loans > Enquiries > Loan
Schedules (Full)
Look at the repayment schedule
Workshop – 13 Solution
Workshop – 13 Solution
Rollover
Use User Menu > Corporate Operations > Loans > Maintain Loans >
Amend/Reverse – Loans
Roll over the contract used in the previous workshop by another 3 months
by extending the maturity date
If need be, redraw schedules suitably
Use User Menu > Corporate Operations > Loans > Enquiries > Loan
Schedules (Full)
View the effect of changes on repayment schedule
Workshop – 14 Solution
Workshop – 14 Solution
Other facilities
Broker
It is possible to use services of Brokers and pay brokerage by using Broker
related Fields – BROKER.CODE, BROKERAGE, BROKER.CCY and
BROKER.AMOUNT
Possible to default other details from BROKER table once a valid Broker
code is filled up
Negative rate
It is possible to indicate that Negative rates are required. If
NEGATIVE.RATE Field is set as Yes, then, in case of fixed interest, a
negative rate can be input.
In the case of floating rates, if the effective rate becomes negative due to
negative spread, then that would be allowed
Deposit products
In addition to the usual Fixed term, call / notice, interest bearing and
discounted products, bank’s own bond issues using liability
commitment and Certificates of deposits are also possible
CDs are processed using Fixed rate, Interest bearing and A Basis of
interest functionalities
If the MAT.AMOUNT Field is filled up, T24 automatically calculates the
investment amount and fills up the AMOUNT field accordingly
Quiz 4
Tax rates are defined in TAX table. These record Ids can be indicated
in LD in TAX.PRINCIPAL.KEY, TAX.COMMISSION.KEY and/or
TAX.INTEREST.KEY Fields to collect taxes for the respective
components
LD schedules
LD summary
Interest accruals
Repayment history
Workshop - 15
Use User Menu > Corporate Operations > Loans > Enquiries > List of
Loans by Product
View loans by products
Use User Menu > Corporate Operations > Loans > Enquiries > List of
Commitments
View outstanding Commitments
Use User Menu > Corporate Operations > Loans > Enquiries > Loans
disbursed today
View Loans disbursed on the system date
Workshop – 15 Solution
Workshop – 15 Solution
Workshop – 15 Solution
Standard Reports
Imminent Maturities
Maturing Events
Contract Accruals
Rate Revisions
Contract status
System maintained Tables
LMM.ACCOUNT.BALANCES
Contains information relating to principal movements, interest accruals,
commission accruals and funds paid / received in the contract
LMM.SCHEDULES
Diary of future events for authorised contracts in LD and MM
Id is made up by contract number, event date (in Julian date format like
2001305 to indicate 305th day in the year 2001) and a suffix of 00
LMM.SCHEDULES.PAST
Events from LMM.SCHEDULES after the event date
Exception Sending Payment activity. If a Payment has to be sent two days
prior to value date of payment according to DAYS.DELIVERY Field in
CURRENCY table, then will remain in LMM.SCHEDULES file for two
more working days
Updated in Close of business processing. Same Key as in
LMM.SCHEDULES
System maintained Tables
SETTLEMENT.RATES
Used to store liquidation exchange rates for various event dates and
currencies
PROTECTION.CLAUSE Field
If set to YES, system derived exchange rate is compared with historic
exchange rates applied and the best exchange rate (whichever is more
beneficial to the Bank) considered for liquidation
If set to NO, either the user input rate, and in its absence, system derived
rate would be used for liquidation
System maintained Tables
EB.CONTRACT.BALANCES
Balance file containing details of consolidation key and Asset type wise
balances
Principal outstanding amounts in product files and any related amount fields
such as accrued interest, charges, commissions, etc.
Information held currency wise, Asset type wise and date wise balance as
well as consolidation key
LD Dependency diagram
FT.COMMISSION.TYPE
BASIC.RATE.TEXT
BASIC.INTEREST LMM.CHARGE.CONDITIONS
CUSTOMER
CATEGORY INTEREST.BASIS LMM.INSTALL.CONDS
The dependencies and linkages between LD module and T24 Core and
other applications