negativeRateOption - Minimum/Maximum Rates

The minimum/maximum rates in Fairways Debt enable you to define an interest rate range for floating rates. 

<standardLoan>
<phases>
<phase>
<indexing>
<index>
<advanced>
<interestRateComputation>
<negativeRateOption>MIN_MAX</negativeRateOption>
<minBoundRate> ... </minBoundRate>
<maxBoundRate> ... </maxBoundRate>

</interestRateComputation>
</advanced>
</index>
</indexing>
</phase>
</phases>
</standardLoan>

Tag

Item

Description

negativeRateOption

Mandatory

Rules to apply to floating rates.

minBoundRate

Optional

Minimum rate: floating rates lower than the minimum rate are set to the minimum rate.

maxBoundRate

Optional

Maximum rate: floating rates higher than the maximum rate are set to the maximum rate.

 

To apply a minimum and/or a maximum rate to a transaction:

  1. Add the <negativeRateOption> tags with the MIN_MAX value in the <interestRateComputation> tags of the transaction.
<standardLoan>
<phases>
<phase>
<indexing>
<index>
<advanced>
<interestRateComputation>
<negativeRateOption>MIN_MAX</negativeRateOption>
</interestRateComputation>
</advanced>
</index>
</indexing>
</phase>
</phases>
</standardLoan>
  1. Add both or either these tags in the <interestRateComputation> tags of the transaction:
    • <minBoundRate>
    • <maxBoundRate>
<standardLoan>
<phases>
<phase>
<indexing>
<index>
<advanced>
<interestRateComputation>
<negativeRateOption>MIN_MAX</negativeRateOption>
<minBoundRate></minBoundRate>
<maxBoundRate></maxBoundRate>

</interestRateComputation>
</advanced>
</index>
</indexing>
</phase>
</phases>
</standardLoan>
  1. Enter the minimum and/or the maximum rate(s).

Note: The maximum rate must be higher than the minimum rate.

In this example, we enter:

  • A minimum rate of 0.50
  • A maximum rate of 0.60
<standardLoan>
<phases>
<phase>
<indexing>
<index>
<advanced>
<interestRateComputation>
<negativeRateOption>MIN_MAX</negativeRateOption>
<minBoundRate>0.50</minBoundRate>
<maxBoundRate>0.60</maxBoundRate>

</interestRateComputation>
</advanced>
</index>
</indexing>
</phase>
</phases>
</standardLoan>

The rates display in the Indexation panel and apply to the transaction schedule.

Transaction_InterestRateFixingRules_EN.png

Transaction_Schedule_EN.png

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