Money Market Loan Rollover – Partial

PURPOSE

To show illustration of money market loan rollover – partial.

OVERVIEW

i. In a rollover, CS Lucas system automatically create a new Money Market Transaction for the rollover trade.

ii. The settlement is cleared through a “system clearing account”.  

iii. The accounting is deal with as illustrated below.  The same treatment is used for loan and deposit (placements).

TRANSACTION DETAILS

Accounting Base Ccy
Trade ID
Trade Date
Value Date
Maturity Date
Currency
Amount
Rate
Accrual Method
Total Interest
Maturity Amount

Original Trade

USD
MMK1001
3-Feb-03
3-Feb-03
3-Apr-03
SGD
1,000,000.00
5.1232%
Act/365
8,281.34
1,008,281.34

New Rollover Trade

USD
MMK1002
3-Apr-03
3-Apr-03
25-Apr-03
SGD
1,000,000.00
5.1500%
Act/365
3,104.11
1,003,104.11

SUMMARY OF JOURNALS

IDDateDescription
J63-Apr-03Money Market Loan Maturity (Original Trade)
J13-Apr-03Repayment of Money Market Loan (Cash Deal)
J23-Apr-03Money Market Loan Start
J325-Apr-03Money Market Loan Maturity

J6                        Money Market Loan Maturity (Original Trade)

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
MMK10013-Apr-03PMMK - Loan Interest ExpenseSGD8,281.340.571525USD4,732.99J6a
MMK10013-Apr-03BMMK - LoanSGD1,000,000.000.567456USD567,456.38J6b
MMK10013-Apr-03BCash at Bank (Clearing A/C)SGD-1,008,281.340.581416USD-586,230.53J6c
MMK10013-Apr-03PFX - Realised Losses - RevenueSGD0.00USD81.91J6d
MMK10013-Apr-03PFX - Realised Losses - CapitalSGD0.00USD13,959.25J6e

J1                        Repayment of Money Market Loan (Cash Deal)

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
CDL10013-Apr-03BCash at Bank (Clearing A/C)SGD8,281.340.567456USD4,699.30J1a
CDL10013-Apr-03BCash at BankSGD-8,281.340.567456USD-4,699.30J1b

J2                         Money Market Loan Start

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
MMK10023-Apr-03BCash at Bank (Clearing A/C)SGD1,000,000.000.567456USD567,456.38J2a
MMK10023-Apr-03BMMK-LoanSGD-1,000,000.000.567456USD-567,456.38J2b

Note J2a:               The booking rate on 3-Apr-2003 is 1.76225 (multiplier 0.567456). The rate is rounded to 6dp for display. Full precision is used in calculation.

J3                         Money Market Loan Maturity

TradeIDPostDateB/PAccountCcyCcy AmountExc RateCcyBase AmountLine
MMK100225-Apr-03PMMK - Loan Interest ExpenseSGD3,104.110.572080USD1,775.80J3a
MMK100225-Apr-03BMMK - LoanSGD1,000,000.000.567456USD567,456.38J3b
MMK100225-Apr-03BCash at BankSGD-1,003,104.110.562661USD-564,407.27J3c
MMK100225-Apr-03PFX - Realised Gains - RevenueSGD0.00USD-29.24J3d
MMK100225-Apr-03PFX - Realised Gains - CapitalSGD0.00USD-4,795.67J3e

Note J3a:               The average multiplier rate between 3-Apr and 25-Apr is 0.572081. See Exchange Rates below. Note that the last day of the loan is not included.

Note J3d:                The realised foreign exchange gain on interest expense is analyzed as follows:

SGDRate+
USD
At Closing Rate3,104.110.562661
1,746.56
At Average Rate3,104.110.572081
1,775.80
Gain in exchange
29.24

+ Rates used for calculation are in full precision. Illustrated rates are rounded to 6dp.

Note J3e:                The realised gain on the loan is analyzed as follows:

SGDRate+
USD
At Closing Rate1,000,000.000.562661
562,660.71
At Start Date1,000,000.000.567456
567,456.38
Gain in exchange
4,795.67

+ Rates used for calculation are in full precision. Illustrated rates are rounded to 6dp.

EXCHANGE RATES

Our illustration assumes the company uses different daily exchange rates for accounting.

Average rates are computed by using the multiplier rate from trade/transaction currency to the base currency each day and averaging this over the relevant period.

The following rates were used for this illustration.

Spot Rate

DateUSD/SGDSGD/USD*
3-Apr-031.7622500.567456

Average

From DateTo DateSGD/USD*
3-Apr-0324-Apr-030.572081

*Rates used for calculation are in full precision. Illustrated rates are rounded to 6dp.

FREQUENTLY ASKED QUESTIONS

RELATED INFORMATION

CHANGE HISTORY

DateByChanges
08-Apr-2004CSCreation.
09-Jun-2016RJReformatted.
23-Apr-2020LTRe-formatting.
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