Wholesale term money deals are used to borrow large amounts from banks and institutions, rather than from small investors. Examples of wholesale term money deals include promissory notes and private debt placements. These types of deals can be fixed or floating rate and are generally not exchanged.
You can automatically reset the floating rates in your wholesale term money deals by setting a benchmark rate and a margin and then running the Reset Floating (Benchmarked) Rates program. For more information, see: Reset Floating (Benchmarked) Rates.
Use the Wholesale Term Money window to enter you wholesale term money deals.
If your Wholesale Term Money (TMM) deals' principal or interest is subject to taxes, Oracle Treasury provides the following tax options: calculate flat tax on the interest amount (INS_F), annual tax on the outstanding principal (PRN_A), flat tax on the starting principal amount (PRN_F), flat tax on the starting principal and subsequent principal increases (PRN_INC_F), flat tax on principal repayments (PRN_DEC_F), and flat tax on the maturity amount (MAT_F). For more information, see: Tax Schedule and Details.
Navigate to the Wholesale Term Money window.
Choose a company and counterparty for the deal in the Company and Counterparty fields.
If you are acting as a broker for a client, in the Client field choose a client.
In the Portfolio field, choose a portfolio for the deal.
If you want to apply a limit to the deal, in the Limit field choose a limit.
In the [ ] Descriptive Flexfield, complete the flexfield as required. For more information on descriptive flexfields, see: Defining Descriptive Flexfields.
Choose the Main Details tab region.
In the Deal Subtype and Product Type fields, select a deal subtype and a product type for the deal. The brokerage details appear for the selected product.
In the Currency field, choose a currency for the deal.
In the Principal Amount field, enter a principal amount for the deal.
In the Day Count Basis field, select the day count basis that you want to use to calculate interest on the deal.
In the Start Date and the Maturity Date fields, enter a start date and a maturity date for the deal.
Choose the Interest Details tab region.
In the Initial Basis field, select the type of rate for the deal, either Fixed or Float.
If you selected Fixed, in the Fixed Until Date field, enter the date up to which you want to fix the rate. On this date, the deal rate will change from fixed to floating.
If you want the deal rate to stay fixed until maturity, in the Fixed Until Date, enter the same date as you entered in the Maturity Date field.
If you selected Float and you want to be able to automatically reset the floating rate, enter values for the benchmark rate and the margin.
In the Interest Rate field, enter an interest rate for the deal.
Enable the Prepaid Interest check box if you intend to settle the interest on the start date of each transaction rather than the maturity date.
Enter a rate in the Benchmark Rate field. Choose a rate that you want to use as the benchmark for resetting the floating rate. For example, if you want to reset the floating rate based on the U.S. dollar 1-Month rate as the benchmark, choose the reference code that you set up for U.S. dollar 1-Month in Current System Rates.
Enter a margin for the deal in the Margin field. The margin is used for resetting the floating rate and should be entered in basis points and can be positive or negative. For more information on resetting floating rates, see: Reset Floating (Benchmarked) Rates program.
Note: You can leave the Benchmark Rate and Margin fields blank and adjust your floating interest rates manually.
To generate month-end dates for maturity dates and corresponding interest due on dates, enable the Force Month End check box.
Note: To ensure month-end dates, you must also set the Business Day Convention Maturity Dates field and Interest Due On Dates field to No Adjustment. To ensure that month-end dates that fall on weekends or holidays are automatically adjusted to business days, choose another value according to your needs.
The Force Month End option does not affect the maturity date of the deal.
In the Business Day Convention region, choose a setting for Maturity Dates and/or Interest Due On Dates. Treasury adjusts the dates that fall on non-business days according to the settings that you choose. The choices are: Following, Modified Following, Modified Previous, No Adjustment, and Previous.
You can apply a separate adjustment to each field:
The Maturity Date affects the interest amount.
The Interest Due On Date is the settlement due date; it is also used as the journal date for the interest payment.
In the Payment Frequency field, choose an interest payment frequency for the deal. Possible frequencies are Weekly, Monthly, Quarterly, Semi-Annual, or Annual.
In the First Transaction Maturity field, you can update the maturity date of the first transaction based populated by Treasury. Treasury populates this date based on the values of Start Date, Force Month End, Business Day Convention Maturity Date, and Payment Frequency. If you change the populated date, then Treasury will base future maturity dates and interest due on dates on this modified date rather than the deal's start date.
Choose the rounding rule that you want to use to calculate interest in the Interest Rounding field. The possible choices are: Nearest, Round Up, or Round Down.
Choose the day that you want to include when you calculate interest on the deal in the Interest Includes field. The possible choices are: First Day, Last Day, or Both Days.
Note: If you select Both Days for Interest Includes, you cannot use the 30/360, 30E/360, or 30+/360 day count basis.
In the Additional Details tab region, complete the fields as necessary.
In the Brokerage/Tax tab region, complete the fields as necessary.
Note: For both principal and interest tax, the tax rate effective on the settlement date of the deal is used in the calculations. Any change that occurs in the tax rate is not reflected.
Save your work. The deal is checked against the applicable limits and the Transaction Details window appears. This window lists the details of each transaction or payment period in the wholesale term money deal.
If you have deals with floating interest rates and you want to reset the floating interest rates based on the benchmark rates and margins, run the Reset Floating (Benchmarked) Rates concurrent program. For more information, see: Reset Floating (Benchmarked) Rates program.
In the Interest Due On field, Treasury populates the settlement due date. You can update the populated date, if necessary.
This date is used as the journal date of the interest payment.
Save your work.
You can adjust the principal on one or more transactions in a wholesale term money deal at any time during the period of the deal. For example, you can add a payment in the middle of a payment period.
You can enter either a single adjustment or create a schedule of multiple adjustments. For multiple adjustments, you can review and recalculate your adjustment schedule before saving.
In the Wholesale Term Money window, query the deal you want to adjust.
Choose the Principal Adjustment button. The Principal Adjustments window appears.
Enter the Adjustment Amount.
Select the Principal Action, either Increase or Decrease.
Select an Adjustment Type of Single or Multiple.
Enter the Effective date for the adjustment.
If you are creating a single adjustment, save your work.
If you are creating multiple adjustments, select the adjustment Frequency. The choices are: Weekly, Monthly, Quarterly, Semi-Annual, or Annual.
Enable the Force Month End check box to generate month-end dates for the adjustment effective dates.
In the Business Day Convention field, select a setting for the Effective dates that fall on non-business days. The choices are: Following, Modified Following, Modified Previous, No Adjustment, and Previous. The setting you choose affects both the adjustment effective dates and the maturity date of the preceding transaction.
If you enable the Force Month End check box, enter No Adjustment.
Choose the Review Schedule button to open the Review Schedule window. Use this window to review your principal adjustments.
The Non Business Day column indicates the adjustment dates that fall on non-business days. The Existing Adjustment column indicates the adjustments that already exist for this deal.
If necessary, you can update the Amount and corresponding Action of any adjustment date. You can also delete any principal adjustment that is not pre-existing. Choose the Recalculate button to review the new principal adjustments.
Save your work.
You can adjust the interest on a wholesale term money deal at any time during the period of the deal.
In the Wholesale Term Money window, query the deal you want to adjust.
Choose the Interest Adjustment button. The Interest Rate Adjustments window appears.
Enter a new interest rate.
Select a period in which you want the interest rate to take effect.
If you want the interest rate to expire on a certain date, enter the date in the Applies Until field. If you do not enter a date in this field, the rate applies to every period after the effective date.
Save your work.
Use the Transaction Details window to settle interest for specific transactions in a wholesale term money deal. You can also specify the date on which you want to settle your payments.
In the Wholesale Term Money window, query the deal you want to settle.
Choose the Transaction Details button. The Transaction Details window appears.
In the Gross Interest field, the total amount of gross interest for the wholesale term money deal appears. You can override this calculated interest amount by entering a new interest amount. The System Interest field shows the original interest amount calculated by the system.
Note: You can only override interest amounts if you have the appropriate user access levels. See: User Access Levels.
If necessary, update the corresponding Maturity Date.
If this transaction includes prepaid interest, the displayed Interest Due On date is equal to the transaction start date. Otherwise, the displayed date is equal to the transaction maturity date.
For each transaction that you want to settle, check the Settle Interest check box.
If you deselect the Settle Interest check box, the interest for that payment will be added to the settlement for the following payment.
If this transaction includes prepaid interest, the Interest Refund displays either the refund amount issued after the principal decrease or the amount of additional prepaid interest issued after the principal increase.
Save your work.
Use the Transaction Details window to view the individual transactions that are part of a wholesale term money deal.
In the Wholesale Term Money window, query the deal that you want to view.
Choose the Transaction Details button. The Transaction Details window appears listing all of the transactions for that deal.
Use the View Wholesale Term Money window to view the details for a wholesale term money deal.
In the View Wholesale Term Money window, query the deal that you want to view.
If you want to view the individual transactions that make up the wholesale term money deal, choose the Transaction Details button. The View Transaction Details window appears.