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Foreign Exchange User Manual

1. 3 Authorization Web Page Dialog Contract Reference Number CHOFXSP001850009 Event Code Event Date Maker I Generate Messages Rekey Fields Counterparty Exchange Rate Currency Deal Amount Value Date EA Change Log E O Field Description Old Value New Value Overrides EE I Oo Confirmed Auth By Authorize Date Stamp Override Authorize Status Override Text The following details will be displayed here Contract Reference Number The FX contract reference number is displayed here Event Code The code of the event happening on the contract is displayed here Event Date The date on which the event happened is displayed here Maker The name of the maker of the contract is displayed here Generate Messages Check this box if you want the system to generate messages for the event once it is authorized ORACLE 6 8 11 1 Displaying the Rekey Fields If the contract involves a product for which some Re key fields have been defined the details of the contract will be displayed only after you input the values in those fields If no Re key fields have been defined the details of the contract will be displayed in the Authorization screen If you are authorizing an amendment the old values of the fields that were modified will be displayed along with the new values In the re key fields you should enter the values that were given during the amendment All the overrides that were given during the inpu
2. You can define the preferences for a product in the FX Product Preferences screen The following are the preferences that you can define for a product Code The product for which you are maintaining preferences is defaulted here Description The description of the product is displayed here ae ORACLE 4 2 1 4 2 1 1 Specifying Preferences for Forward Contracts Option Date Allowed For a product you can indicate whether an Option Date can be specified for forward deals during deal processing If you specify an option date then you can change the contract value date to any date between the option date and the original value date This means that the contract may be liquidated anytime between the option date and the value date of the contract To allow an option date check this box However if you have allowed an option date for a product you need not necessarily enter an option date during deal processing Max Tenor In Months When you create a product you can specify the maximum tenor for forward deals involving the product You cannot enter a deal with a tenor that exceeds that specified for the related product However you can enter an FX deal with a tenor that is less than that specified for the product To specify the maximum allowed tenor for a product enter an absolute value in months in the Max Tenor field Example You are creating a product for Forward deals coded FXFW You d
3. FX_CONFIRMN Confirmation Advice LIQD Liquidation Accounting Entries Accounting Role Amount Tag Dr Cr Indicator CONTINGENT BOT BOTAMT Credit CONTINGENT SOLD SOLDAMT Debit BROK_PAID BROKAMT Debit BROK_PAYABLE BROKAMT Credit SETTLEMENT BOT SETBOTAMT Debit SETTLEMENT SOLD SETSOLDAMT Credit NDF_SET NDF_PROFIT Debit NDF_INC NDF_PROFIT Credit NDF_EXP NDF_LOSS Debit NDF_SET NDF_LOSS Credit 10 6 ORACLE Advices Nil 10 5 1 4 REVR Reversal Accounting Entries No accounting entries allowed for this event The system does an automatic reversal of all entries booked for the contract till date Advices Advice Name Description FX REVERSAL Transaction Reversal Advice FX_BROKREVR Brokerage Reversal Advice REVSWIFT Generation of MT292 on reversal of a contract 10 5 1 5 ROLL Rollover Accounting Entries Accounting Role Amount Tag Dr Cr Indicator CONTINGENT BOT BOTAMT Credit CONTINGENT SOLD SOLDAMT Debit CONTINGENT BOT ROLLBOTAMT Debit CONTINGENT SOLD ROLLSOLDAMT Credit SETTLEMENT BOT SETBOTAMT Debit SETTLEMENT SOLD SETSOLDAMT Credit Advices Advice Name Description FX ROLLOVER Transaction Rollover Advice 10 5 1 6 REVL Revaluation Accounting Entries for NPV Rebate Accounting Role Amount Tag Dr Cr Indicator UNRLZ FWD PNL
4. fer ORACLE Broker Code The code that has been allotted to the Broker in the Broker Details table Liquidated Whether included in the report specified by you through the Report contracts Options screen For each contract the following details will be reported Contract Reference The Reference number of the contract No Buy or Sell The type of contract Start Date The Start Date of the contract Maturity Date The Maturity Date of the contract Brokerage CCY The S W I F T Code of the currency in which the brokerage on the contract was processed Brokerage Amount The amount of brokerage involved in the brokerage currency Brokerage Status The status of the contract It can be liquidated or outstanding The following totals will be reported for each broker e Total Brokerage Amount in the brokerage currency e Total Outstanding and Total Liquidated brokerage in the brokerage currency e Total number of contracts reported e Total Outstanding and Total Liquidated in the local currency converted using the latest conversion rates available in the Currency table 12 10 FX Rollover Due Report This report gives details of contracts that are due to be rolled over within a specified period You have to specify the period through the Report Options screen From Date Enter the date indicating the beginning of the period for which the report is to be generated Al
5. You can retrieve the alerts from Unprocessed Alert Browser on Oracle FLEXCUBE Unprocessed Alerts PROCESS fts o Description FX1FFB1080200030 CLS status is modified to Failed Menu From this browser you can manually select an alert and process it Use the checkbox adjoining an alert and click Process button Processed records will not be displayed on the browser anymore ORACLE 7 1 12 Specifying UDF Values You can associate values to all the User Defined fields created and attached to the CLS Alert Group screen You can view the list of User Defined fields associated to this screen by clicking Fields button on the CLS Alert Group screen User Defined Fields User Defined Fields CIl Field Name O You can enter the value for the UDFs listed here in the Value column For more details on how to create user Defined fields refer chapter Creating custom fields in Oracle FLEXCUBE in the User Defined Fields User Manual under Modularity 7 1 12 1 The Alert Generation Process The system will check the CLS Status Browser for any deals with CLS Status as maintained in the CLS Alert Group screen If the specified Deal Status is Rescinded or Failed only Active deals with the specified status will be considered If any deal is found the deal reference and status details will be inserted into a table to be picked up for displaying to the select
6. All From Date Range To Date Customer All Customer O Single Funds Transfer Reference Number 12 23 1 Contents of the Report The contents of fund transfer to foreign exchange netting report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body You can find the following details in the body of the report Value Date The date on which contracts are to be settled Customer The code that identifies the customer FT Reference The reference number of the FT contract No Netting The netting reference number of the contract ne ORACLE Reference No CCY The currency involved in the transaction Amount The amount involved Dr Cr The type of accounting entry i e debit or credit Netting Date The date on which netting happened Netting Type The type of netting used Upload Status The upload status FX Reference The reference number of the foreign exchange contract No Amount The amount involved in the transaction Dr Cr The type of accounting entry i e debit or credit Netting Status The status of netting i e fully partially 12 24 FX to FT Netting Report FX to FT Netting Report provides information on FX to
7. Deleting a contract You can delete e A contract that has been input by you and is not yet authorized or e A contract that has been put on hold In the Contract Detailed View screen select Delete icon in the Application tool bar or click delete icon You will be prompted to confirm the deletion Once you confirm it all the details of the contract including the accounting entries will be deleted You can choose not to confirm the deletion In either case you will be returned to the Contract Detailed View screen If the contract involves a product combination the details of all the legs of the contract will be deleted a ORACLE 6 8 7 6 8 8 Reversing a contract To cancel out an authorized contract you should use the Contract Reversal function In the Contract Detailed View screen select Reverse from the Processing sub icon You will be prompted to confirm the reversal Once you confirm it all the accounting entries that have been passed for the contract will be reversed this is done by passing the entries with a negative sign These entries could be the contract initiation entries or any liquidation entries A contract that is past its Value Date and has been settled can also be reversed You can choose to suppress or change the priority of the reversal advices Reversal advices to the counterparty will be sent if they are on TELEX or Mail Please note that Settlement Messages for the reverse
8. FX contract upload functionality will also update utilizations of risk weighted credit line The risk percent obtained for a contract will be stored at a contract level post upload FX Contract upload will also support brokerage upload The external brokerage amount and brokerage currency passed from the external system will override the brokerage amount maintained in Oracle FLEXCUBE In case the external system doesn t send any brokerage amount then the default brokerage setup in Oracle FLEXCUBE will be used on ORACLE 6 2 5 Specifying the Rollover instructions Tab Details By default a forward contract that is marked for roll over will be rolled over with the terms of the original contract However you can change certain terms by specifying them in the Roll over Instructions screen Click on Roll over In the FX Contract to go to the Roll over Instructions screen Foreign Exchange Contract Input WI ot Fr ba Product Code laz m Related Reference Counterparty Contract Reference Number Number Reversed Reference pees External Reference Number Source Number Bill Reference Number Product Description User Reference Number Fund Identity Main Rollover Instructions Netting Revaluation Details Auto Rollover Rollover Required Bought Amount Value Date Sold Amount Value Date Rollover Exchange Rate Rollover Date Rollover Local Currency Rollover Spot Rate Equivalent Spot Date Rollover Premiu
9. Foreign Exchange Contract Input gt menn nannaa M Ha o W p erae Product Code faz Pl Related Reference Ci P VO EERATR Number Counterparty Contract Reference De Number Reversed Reference saer External Reference Number Source Number Bill Reference Number Product Description User Reference Number Fund Identity Main Rollover Instructions Netting Revaluation Details Netting Type let Netting Customer Netting Status lett Mode of Netting Bought Leg Sold Leg Netting Date Netting Date Value Date Value Date Settlement Account Settlement Account Risk Netting Reference Risk Netting Reference Number Number Fund Transter Reference Fund Transfer Reference Number Number Netting Reference Netting Reference Number Number Fund Transfer Status Fund Transfer Status Related Foreign Exchange Related Foreign Exchange Contract Contract Settlement Risk Risk Netting Type Risk Weighted Risk Pre Settlement Risk f MIS Fields All Messages Je Cor s i The following details can be captured here Netting Type In this field you must first indicate the type of netting You can net the contracts involving a customer in two different ways Contracts can either be netted e Pairwise ee ORACLE e Currency wise If you choose to net contracts pair wise the system selects all contracts that have been specified for pair wise netting for the counterparty Contracts that have the same currency pair irrespect
10. Select the sold currency from the option list When you click Search button the records matching the specified search criteria are displayed For each record fetched by the system based on your query criteria the following details are displayed Authorization Status Reference Number Buy Sell Bought Currency Outstanding Amount User Reference Number Contract Status Liquidate Cancel Sold Currency Value Date Real Date Click Advanced Search to display the screen below ae ORACLE Advanced Search Operator Value Authorization Status Contract Status Reference Number User Reference Number Buy Sell Liquidate Cancel Bought Currency Sold Currency Outstanding Amount v Query And or Clesr Query Order By Ascending w Acoeot I Clesr Query You can query a contract based on any of the following details Authorization Status Contract Status Reference Number User Reference Number Buy Sell Liquidate Cancel Bought Currency Sold Currency Outstanding Amount 6 64 ORACLE 6 12 Viewing FX Contract You can view the FX contract using Foreign Exchange Contract Summary screen To invoke this screen type FXSCONON in the field at the top right corner of the Application tool bar and click the adjoining arrow button Foreign Exchange Contract Summary Bought Currency Hil Bought Value Date
11. The currency codes of all the currencies defined for your branch are displayed here If you have chosen the Selected Currencies option in the previous field you can select the currencies that you want to include in the report The details of revaluation on contracts involving all these currencies will be reported To remove a currency from this list uncheck the corresponding checkbox Report For Products In this field you can specify the products for which the report is to be generated If you select e All Products The details of revaluation on contracts involving any product will be reported e Selected Products The details of revaluation on contracts involving only the product s that you select in the next field will be reported ane ORACLE Products A list of all the products that are used in the branch is displayed here If you have chosen the Selected Products option in the previous field you can select the products that you want to include in the report The details of revaluation on contracts involving all these products will be reported To remove a product from this list uncheck the corresponding checkbox Revaluation e Actual Details of revaluation performed through the Rebate NPV Revaluation method will be reported e Memo Revaluation for all contracts as of the last Memo revaluation will be reported In this case the revaluation is performed on all active contracts but accounting entries are
12. in the User Defined Fields User Manual under Modularity 3 5 4 1 Defaulting of Credit Lines As mentioned above in a FX contract creation the following credit lines are involved Settlement Risk Credit Line Pre Settlement Risk Credit Line Weighted Risk Credit Line Following are the possible ways to set these credit lines If Track Settlement Risk box is checked and if no Settlement Risk Credit Line is provided as part of the upload then list of valid lines maintained for the Counterparty Product Branch Currency will be determined If there exists only one line for the combination specified then that will be defaulted If Track Pre Settlement Risk box is checked and if no Pre Settlement Risk Credit Line is provided as part of the upload then list of valid lines maintained for the Counterparty Product Branch Currency will be determined If there exists only one line for the combination specified then that will be defaulted at ORACLE e f Track Weighted Risk box is checked and if no Weighted Risk Credit Line is provided as part of the upload then list of valid lines maintained for the Counterparty Product Branch Currency will be determined If there exists only one line for the combination specified then that will be defaulted e In a situation if more than one valid record exists for credit line which has not been passed in upload then an error will raised one ORACLE 4 1 4 Defining Attributes specif
13. 3 4 MAINTAINING DISCOUNTING RATES ci 2 sccciislecsessdsetnvescectscncssercsstestevatesceveenecsteanavsceseeveeseontosevagevuessceseodestees 3 8 3 4 1 Specifying UDF Valul Sarriren eee NEEE E EEEREN 3 10 3 4 2 Querying Discount Rate Soezie e E E EE E E E RE s 3 11 3 4 3 Querying Based ON Len OF ocsc ticessccssopaneusnaes pss esotea vege cdunndanedyaptunedy co bebedo boanedbengige sya N EN ER 3 11 3 3 NETTING DETAILS 5 scccichcccc cece tian tk icv beds cas ENEE essen E EE E E EEEE 3 12 3 5 1 Maintaining Netting Detail Sinci e EE EE EEEN 3 13 3 5 2 Specifying UDE Values acro ine ie e EEIN EEEE REEE 3 18 3 5 3 Maintaining FX Risk Netting DetailS sssssssissrserorirricisrisreseieriirerserirsrisereseorisvresoivsevresevesosserisserses 3 18 3 5 4 Specifying UDF Valul Siiri ne e ENE EIEE EI 3 21 4 DEFINING ATTRIBUTES SPECIFIC TO FX PRODUCTS eeseseeseeseeroeseseeescesoroesesecoeoeroroeseseeeeoesoroeseeeseee 4 1 4 1 INTRODUCTION teares ana Cyetts tans cdecuscoateesvayvecs sashcsetsanovesses e e cvavacsrestenc 4 1 4 2 INDICATING PREFERENCES FOR A PRODUCT c ccccscsssessesesssesscseesscsseesssseseuesecsessessesessseseesseseussssseseusseseeaees 4 3 4 2 1 Specifying Preferences for Forward Contracts ccccccccesscesscesecesecesecesecuseesaeeseeseeeeeeeseeeseceaeenseenaeeaas 4 4 4 3 PRODUCT COMBINATIONS nirien bencanane keoshstacecevsesscesuacesiseusdscuseuscecacsseusesat ace ses ieeuseatsnacccceteouestacunesees 4 22 4 3 1 Maintaining Product Co
14. Refer the Continuous Linked Settlements chapter of this User Manual for details on maintaining the above preferences and the processing involved in the settlement of CLS deals as ORACLE 3 2 3 Specifying UDF Values You can associate values to all the User Defined fields created and attached to the Foreign Exchange Branch Parameters screen You can view the list of User Defined fields associated to this screen by clicking Fields button on the Foreign Exchange Branch Parameters screen User Defined Fileds 1of1 Field Name Yalue Ok Cancel l You can enter the value for the UDFs listed here in the Value column For more details on how to create user Defined fields refer chapter Creating custom fields in Oracle FLEXCUBE in the User Defined Fields User Manual under Modularity 3 3 Maintaining Forward Rates When you revalue a forward FX contract using the rebate NPV method of revaluation you will use an exchange rate for the currencies involved referred to as a Forward rate The forward rate for a currency for a specific period is based on the spot rate and the prevailing interest rate The forward exchange rates for a currency are maintained in the Forward Rate Input screen You can invoke the Forward Rate Input screen by typing CYDFWRAT in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow bu
15. The event date The amount for the event The value date for the event The settlement account 9 3 3 Generating User Ref No in Messages If the option User Ref No in messages is checked in the Foreign Exchange Branch Parameters maintenance then the user reference number will be used instead of the contract reference number in the following messages MT103 MT202 Field 20 9 10 ORACLE Field 20 Field 21 In case of a cover the field 21 will be the field 20 of the related MT103 MT300 Field 20 Field 21 MT304 Field 20 Field 21 9 3 4 Generating Cancellation Request Messages During amendment of a contract Oracle FLEXCUBE will reverse the old contract and rebook a new contract with the Reversed Oracle FLEXCUBE ref as the parent contract If no payment messages have been sent for the parent contract then a configurable override will be provided If the payment messages have been generated then the cancellation request message REVSWIFT will be generated a ORACLE 10 2 10 Annexure A Accounting Entries and Advices 10 1 Accounting entries for Foreign Exchange This section contains details of the suggested accounting entries that can be set up for the FX module of Oracle FLEXCUBE The details of the suggested accounting entries are listed event wise FX Events The following is an exhaustive list of events that can take place during the lifecycle of an MM contract In the subsequent paragraphs we s
16. This manual is organized into the following chapters Chapter 1 About this Manual gives information on the intended audience It also lists the various chapters covered in this User Manual Chapter 2 An Overview of the Foreign Exchange Module is a snapshot of the features that the module provides Chapter 3 Maintaining Data Specific to the FX Module explains maintaining information required to begin operations with the FX module Chapter 4 Defining Attributes Specific to FX Products describes the procedure to define attributes specific to FX products Chapter 5 Beginning of Day Operation explains the maintenance functions that need to be performed before operations with the module begin for the day Chapter 6 Contract Processing describes the processing of Foreign Exchange ORACLE deals Chapter 7 Continuous Linked Settlements CLS describes the maintenances and processing details for CLS deals Chapter 8 Annexure 1 Workflow for CLS Deal Settlement provides the possible media and messages that may be used in the settlement of CLS deals Chapter 9 FX Advices and Messages explains the advices and messages that you can generate in the FX module Chapter 10 Annexure A Accounting Entries and Advices gives an event wise list of model accounting entries for the FX module Chapter 11 Glossary provides the list the important terms and its definition Chapter 12 Reports provide
17. e FX Exception report Automatic Processing e FX Straight Line contracts Spot Revaluation report e FX Straight Line contracts Accrual report e FX Rebate and NPV Revaluation report e Netting Agreements report e FX Netting report by Netting Date and Customer FX to FT e FX Netting report by Netting Date and Customer FT to FX e FX Netting report by Maturity Date and Customer FX to FT e FX Netting report by Maturity Date and Customer FT to FX e FT details for an FX contract report oe ORACLE e FX details for a FT contract FT to FX report 22 ORACLE 3 1 3 1 1 1 3 Maintaining Data Specific to the FX Module Introduction Before you begin foreign exchange operations in Oracle FLEXCUBE you must maintain certain basic information in the system For example you must maintain e Forward rates e Discounting rates e Netting details e Spot rates for different currencies This data is essential for processing the foreign exchange deals that you enter into in the course of the day Data of this sort is referred to as Static Data because it remains constant over a period of time Static Data Static data which is maintained in Oracle FLEXCUBE can either be common to several modules or specific to a module For example data relating to exchange rates is common to modules like Foreign Exchange and Funds Transfer Static Data that is commonly accessed by several modules is maintained in the Core Services module
18. s date End Date You can create a product that it can only be used over a particular period The End Date of this period is specified in this field Number of Legs This field identifies the number of contract legs that can be defined under this product combination The system defaults to a value of two legs This cannot be changed Slogan This is the marketing punch line for the product The slogan that you enter here will be printed on the mail advices that are sent to the counterparties who are involved in deals involving the product ia ORACLE 4 3 3 Product Code 1 If the product is a combination of two other products each leg of the deal corresponds to one product in the combination Specify which product corresponds to which leg in the Product Combination screen For deals involving such a product select the product for the first leg of the deal Product Code 2 Select the product for the second leg of the deal Single Swap Advice Required Even if you have specified swap advices for both products in a combination you can generate a single swap advice by choosing this option Maintaining Product Category Details for Internal Swap Transactions You can maintain product category details for internal swap transactions through the Internal SWAP Product Category Maintenance screen An internal swap transaction is a combination of FX and MM transactions generated for a deal between the FX desk and the MM d
19. EUR 51 102 00 LCY Equivalent of this contract is the LCY equivalent as calculated during booking for the non deal currency ror Oracle FLEXCUBE performs the revaluation of the accrued interest and reversal of the unrealized revaluation on a daily basis during account revaluation batch function Revaluation of the accrued interest Until 28 Feb the interest accrued is 2000 GBP 1050 85 949 15 The sum of the LCY equiv of the interest amount accrued as of 28 Feb 2058 99 1071 87 987 12 This is based on the rates prevalent on 31 Jan 1 02 and 28 Feb 1 04 resp If 2000 GBP is converted into LCY for the rate prevailing on 28 Feb the interest would work out to 2000 1 04 2080 ane ORACLE Therefore the revaluation gain on the accrued interest for bought currency 2080 2058 99 21 01 Likewise for USD the interest accrued is 1000 525 42 474 58 The sum of the LCY equiv of the interest amount accrued as of 28th Feb 1014 75 530 68 484 07 This is based on the rates prevalent on 31 Jan 1 01 and 28 Feb 1 02 respectively If you convert 1000 USD in terms of the rate prevalent on the settlement date 28 Feb the interest would work out to 1000 1 02 1020 Therefore the revaluation loss on the accrued interest for sold currency 1020 1014 75 5 25 The revaluation entries passed would be as follows Dr Interest receivable bought currency 21 01 C
20. Today s date 14 November 95 Next working date 16 November 95 which means 15 November 95 is a holiday e During its BOD run this function rolls over contracts with an End Date of 14 November 95 e During its EOD run this function rolls over contracts with an End Date of 15 November 95 Today s date 29 December 95 Next working day 2 January 95 which means 30 December 31 December and 01 January are holidays e During its BOD run this function rolls over contracts with an End Date of 29 December e During its EOD run this function rolls over contracts with an End Date of 30 or 31 December That leaves contracts with an End Date of 1 January which is a holiday yet to be rolled over These contracts will be rolled over when this function is run during BOD on 2 January Since the new contract after rollover is initiated automatically it will be authorized automatically The Maker and Authorizer fields of the new contract will display SYSTEM However note that the original and rolled over details will be maintained as different versions of the same contract The restrictions that you specify for the product will apply to all rolled over contracts linked to it Also the settlement instructions that you entered for the original contract will apply to the rolled over contract This means that the accounting entries that are generated will be passed to the accounts that you specified for the original contract A
21. Broker Hl Buy Sell Counterparty 75 Contract Reference Number External SWAP Reference Product Code Related Reference Number Sold Currency Sold Value Date User Reference Number Authorization Status v Contract Status search Advanced Search Rest Records per page be OD meee Bought Currency Bought Value Date Broker Buy Sell Counterparty Contract Reference Number External SWAP Reference Product Cod 6 Buy Sell Authorization Status Contract Status B Buy A Authorized A Active S Sell U Unauthorised Yet to be Initiated L Liquidated R Reversed H Hold You can click Search button to view all the pending functions However you can to filter your search based on any of the following criteria Authorization Status Select the authorization status of the contract from the drop down list Contract Reference Number Select the contract reference number from the option list Buy Sell Indicate whether buy or sell from the drop down list Bought Currency Select the bought currency from the option list one ORACLE Sold Value Date Select the sold value date Contract Status Select the status of the contract for which you want to check the pending function from the drop down list Counterparty Select the contract amount from the option list User Reference Number Select the user reference number from the option list Bought Value Date Select the
22. Buy Sell Bought Currency Sold Currency Deal Rate Value Date Remarks Premium Discount PremiumDiscount Amount PremiumDiscount Se ae F nT 1 Events Brokerage Settlement Charges Tax MIS Fields on ni ail L Input By Date Time DOCS Reversal Authorized By Date Time NA ol O ba GotoPage a Detaur Counterparty Dealer Liquidate Cancel Cancellation Liquidation Bought Amount Sold Amount F RECALC Contract Status Cancel The basic details of the deal indicating whether it is a Buy or Sell type of deal the currency of the deal and the buy and sell currency and amounts will be displayed You have to indicate whether the deal amount is to be liquidated or cancelled and specify relevant details such as the Deal Rate and Amount To maintain details of a new FX Cancellation Liquidation record select New icon in the Application tool bar or click new icon The FX Liquidation Cancellation screen will be displayed without any details Every record that you create will be processed in Oracle FLEXCUBE only after it is authorized A user bearing a different Login ID can authorize the record that you have created The following details are displayed captured here Reference Number This is defaulted from the contract online You can fetch the transactions of all branches by choosing either contract reference number or branch from thi
23. Cash Position Cash Position oO Reference Number Customer Description Debit Credit Amount Value Date Exchange Rate Against Currency Cancel Similarly double click on spot forward and accrual positions to view the details of the deals that have contributed to the respective positions The details are displayed in the Spot Position Details Forward Position details and Accrual Position Details screen respectively ues ORACLE Spot Position Details Currency Code Spot Position Details Reference Number Customer Description Debit Credit Amount Value Date Exchange Rate Against Currency Forward Position Branch Currency Forward Position o Reference Number Customer Description Debit Credit Amount Yalue Date Exchange Rate Against Currency Accrual Position Details Branch Currency Accrual Position Accural Position Details Reference Number Customer Description DebitiCredit Amount Value Date Exchange Rate Against Currency rr You will notice that for cash and accrual positions system displays the opening balances as on the date on which you are viewing the FX positions au ORACLE 6 14 Defining Internal Swap Transactions You can define internal swap transactions through the Internal Swap Transactions screen An internal swap transaction is a combination of FX and MM transactions generated for a deal between the FX desk and MM desk You can invoke the Internal S
24. Contingent Asset Contingent Liability etc e The GLs under the GL Type to which you would like to post the accounting entries e The advices that you would like to generate for the benefit of the counterparty e If you would like to revalue deals and if so the method of revaluation e Ifyou would like to process brokerage etc All deals in GBP USD for example will acquire the generic attributes defined for the GBP USD product However you can allow modification of certain attributes during deal processing By creating products you not only save time you can easily e Retrieve information relating to deals of a particular type say spot deals in GBP USD e Retrieve information relating to a particular deal e Track deals for MIS purposes Specifying the Brokerage In Oracle FLEXCUBE you can maintain a list of all the brokers with whom you deal with in the Broker Master Maintenance table In this table for each broker you can specify brokerage details such as the broker s name and address a unique code for the broker the brokerage payable currency whether you would like to book brokerage in advance or in arrears etc When creating an FX product you can opt to allow brokerage on deals involving it When processing a deal involving a product for which brokerage is allowed you can specify the broker involved The brokerage details defined for the broker involved in the deal will automatically default to the deal You can ch
25. Currency Sold Amount FT Upload Status Corresponding FT Reference Number Bought Currency Bought Amount Corresponding FT Reference Number FT upload status Value date of FT Settlement account 12 19 FX Discounting Rate Report Discounting rate report provides information on the currency used period code and discount date To invoke the screen type FXRDIRAT in the field at the top right corner of the Application tool bar and click the adjoining arrow button Foreign Exchange Discount Rate From Record To Record From Date From Currency To Date To Currency Here ORACLE 12 19 1 Contents of the Report The contents of FX discounting rate report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body You can find the following details in the body of the report Branch Code The code that identifies the branch Currency The currency used in the transaction Base Date The base date of the discounting transaction Period Code The code used to indicate the period Discounting The FX discounting rate Rates Actual Date The actual date on which discounting happened 12 20 Netting Agreement Report Netting agreement report provides information on the netted Foreign Ex
26. Data that is specific to a module is maintained in the module itself For example data relating to forward and discount rates and netting details are specific to the Foreign Exchange module It is therefore maintained in the Foreign Exchange module Static Data specific to the FX module You can maintain static data specific to the FX module in three different tables They are e Forward Rate Maintenance table e Discounting Rate Maintenance table e Netting Agreements table When invoked from the Application Browser these tables will be displayed as screens The procedure to invoke and maintain these tables is explained below 3 ORACLE 3 2 Maintaining Branch Parameters Branch Parameters refer to some generic processing guidelines that you wish to apply to all foreign exchange contracts entered into by a particular branch of your bank You can define these guidelines in the Foreign Exchange Branch Parameters Maintenance screen available in the Application Browser You can invoke the Foreign Exchange Branch Parameters Maintenance screen by typing FXDBRMNT in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Foreign Exchange Branch Parameters Maintenance Branch Code Description Process Till System Date O Next Working Day 1 Revaluation Reversal Account Revaluation Deal Level Continuous Linked Settlements Preferen
27. Date format and a running serial number for the day The Julian Date is of the following format YYDDD Here YY stands for the last two digits of the year and DDD for the number of day s that has have elapsed in the year Example January 07 2009 translates into the Julian Date 09007 Similarly February 5 2009 becomes 09036 in the Julian format Here 036 is arrived at by adding the number of days elapsed in January with those elapsed in February 31 5 36 The Contract Reference Number for the contract involving Global Bank would be OOOSUSB1090070125 Here 000 is the code of the branch in which you are entering the contract SUSB1 the product code 09007 the Julian Date and 0125 the serial number since we assume this is the one hundred and twenty fifth contract linked to the product Sell US bank for the day Counterparty Indicate the counterparty who is involved in the foreign exchange deal that you are entering oe ORACLE The adjoining option list displays a list of all the customers allowed for the product that you have chosen in the product field Double click on the ID of the customer to choose it User Reference In addition to the automatically generated Reference Number you can identify the contract you are processing with unique reference number Typically you would use this field to capture the reference number assigned to a contract by the counterparty Dealer You can enter the c
28. Date that is later than the Base Date the exchange rate variance specified by you will be picked up for revaluation for contracts revalued under the Rebate method a ORACLE 3 4 The variance you specify will be applied on the Spot Rate to arrive at the Forward Rate depending on the quotation method for the currency The following table summarizes the method of application Direct quotation Indirect quotation Premium Add to the Spot Rate Subtract from the Spot Rate Discount Subtract from the Spot Rate Add to the Spot Rate Maintaining Discounting Rates Discount rates are the interest rates for a currency that you use to compute the Net Present Value NPV of an outstanding FX contract The discounting rate for a Currency and Rate Type is maintained in the FX Discounting Rate Maintenance screen These discounting rates will be used when contracts in different currencies are revalued using the NPV method of Revaluation You can maintain discounting rates for a currency for different tenors in the Discount Rates Input screen You can invoke the Discount Rates Input screen by typing FXDDIRAT in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Discount Rates Input Currency Base Date Rate Type Rate Details C Period Code Discounting Rate Actual Date Input By DOC3 Date Time Modification Number E Authorized
29. Example Consider the following contracts Contract 1 Bought USD 3 million Value Date 15 4 Sold BHD 1 5 million Value Date 17 4 Contract 2 Bought USD 6 million Value Date 15 4 Sold BHD 2 million Value Date 15 4 Contract 3 Sold USD 3 million Value Date 15 4 Bought DEM 4 5 million Value Date 15 4 Contract 4 Sold USD 3 million Value Date 15 4 Bought BHD 1 million Value Date 17 4 When you run the netting process where all the flows occurring on 15 4 are due for netting both legs of contracts two and three and the bought leg of contract one and the sold leg of contract four will be netted The Bought leg of contract four and the sold leg of contract two will not be netted as the BHD settlement is due on a different date 17 4 The netted amounts in this case will be as follows USD inflow 3 million Value Date 15 4 BHD outflow 2 million Value Date 15 4 DEM inflow 4 5 million Value Date 15 4 The status of contract 4 will be updated as Sold netted Bought not netted The bought leg of contract 4 and the sold leg of contract 1 will be netted when the netting process is run on 17 4 oy ORACLE The netted amounts in this case will be BHD 0 5 million on 17 4 At the time of contract processing the netting type that you specify for the customer will apply to all contracts involving the customer You cannot change the limit netting type during Contract B
30. FOREIGN EXCHANGE CONTRACT ccccscccessssceceeaececsscceceesaeeeceesaececsuseeeessrseesenaees 12 23 12 19 FX DISCOUNTING RATE REPORT cccssscecsssceceessececsesaeeecenceeeesaeeecsesaececeeeeecessaeeecsesaeeseseeeeeeseeeeseaaees 12 24 12 19 1 CONDENS of th REPOTE sci sicsietesntsasensdasnbacevanes rrisni cosie E oeiia a r iE EEEE 12 25 12 20 NETTING AGREEMENT REPORT csssscceesesceceessececeesaececenceeeecsaececsesaececseceeceesaeeecseaaeeeceeeeeeessneseesenaess 12 25 12 20 1 Contents of the Repoftt cscccsccssecsseeseeseeeseeeseeeccesecesecaeceaecuaecaaecaaeeaaeeaaeeseseaeeeeseseesaseseeeeeeneeeaes 12 25 12 21 BROKERAGE CONFIRMATION JOURNAL cecssccesssscecessececsnscecesaececeesuececseseecsesaeeeceesaeeesseeeeeeeseeeenenaees 12 26 12 211 Contents of the Repoftt ccsccesccsscsseeseesseeseesseeeseesecesecesecaeceaecaaecaaecaaeeseeeaeeeeeseeseseeeeeeneeseeeeeeeaes 12 26 12 22 CONTRACT MATURITY DUE REPORT ccssssccesssececeeaeeeceseceeesaececsesaececseceecsesaeeecsesaeeeesneeeceeseeeesenaees 12 27 12 22 1 Contents of the Repoftt ccscccsccssesseeseesseeseeeseeseeesecesecesecuaecnaecaaecaaeeaaeeseecseeseeseeseaeeeaseeeeeenenseenaes 12 27 12 23 FUND TRANSFER TO FOREIGN EXCHANGE NETTING REPORT c sssccecseseeeeeseeeecseaeeecseseeeessneeeenenaees 12 28 12 23 1 Contents of the R POrt ccsccesccssesseeseescesseesseeseeesceesecusecaecuaecaaecaaeeaaesseeeseeeeeeeeseseesaseeseseeeeeeeaes 12 28 12 24 FX TO F
31. FX Contracts Processing with Netted Limits Trackin g 1 ccsccssesseesseeseeeseeeneeseceseceecesecuseenseeaeens 6 35 6214 Uploaden e ae E E E E O salient tus E E E 6 37 6 2 15 Amendment of Uploaded Deals cccccesccssesccssesnseseeseesecssesecuceeecseescesecseesecaaeeeesaeeaeeaecseeseeaeeeesaeeeeeaees 6 37 6 3 INDICATING THE OPTION PERIOD AND THE RATE cccccsssssesenseseescsseseeecsscsececssesececsscsececsscsecesnacnecsenaeneees 6 37 OA VIEWING EVENT DETAILS 0 ccciteissd csecsnsotssssiss cucsucsetisssedscuevacseteestths cue recsevsdstedingarecsstuasncd ERSEN KEENER EEE 6 38 6 5 SUPPRESSING OR PRIORITIZING ADVICES cccsccsssesscsessesscsenseseceeeeseceessesecesaeseceesseneceeneesecesnseseseeasneenees 6 40 6 5 1 Suppressing the generation Of AN AAVICE scesceeseeseesseeeeeeeesecesecusecesecuseceaecaaecaaeeaeeeaeesseeeeeeeeeenees 6 40 6 5 2 Indicating the priority Of AN AAVICE sccceceeeeecseeeetecesecesecesecusecaeecaeeeseeeseeeaeeseeeeeeeneesaeenseseaeenaeeaes 6 40 6 6 BROKERAGE DETAILS 0 sccsccsssetscssads cea vensetscssteecuesucsotscssassouestasettesttes cuevecsotuestasieyerdasetuasecuinyssecestubesneteusseesvttis 6 41 0 7 SETTLEMENT DETAILS cecscsecsetscescdecvecensettdevies cussucseticesagsouecensettdestes cuevecsetudetedeuacenssttiestascgavecestuiuneaituesnesttis 6 41 6 8 OPERATIONS ONA CONTRACT issivesonedsaccstpvinescetvase rates taeveusestusiovtn vi EESE r ERRARE EN EEES EEES ouevsies ENER NENES 6 41 6 8 1 Am
32. LCY FCY Rate Broker Specify the broker involved in an FX deal in this field The adjoining option list displays a list of the brokers that you have maintained in your bank Choose the broker involved in the deal by double clicking on the ID of the broker If brokers have been disallowed for the product that you chose in the Product Code field you cannot specify a broker for the deal When a deal involving a broker is processed the brokerage applicable to the broker will be picked up and the necessary accounting entries passed Customer Spread Similarly the spread that you have maintained for the specified Counterparty Currency Pair and Tenor combination in the Customer Spread Maintenance screen is picked up and applied for the customer involved in the deal While picking up the Customer Spread the System ascertains the tenor of the contract according to the following logic Buy Tenor Buy value date System date Spot date oe ORACLE Sell Tenor Sell value date System date Spot date sron If spread details for a specific counterparty for the currency pair are unavailable the System looks for the customer spread maintained for the wildcard ALL entry If even that is not available then the Customer Spread defaults to zero Spread Definition The spread definition which indicates whether spread is calculated in percentage or points is displayed here Option Date You can specify an option date
33. Minute Minute Funds Completion Cut off Days Hour Minute Input By DOC4 Date Time Modification Number Authorized Cancel Authorized By Date Time Open The following details are captured here Currency Select the currency for which CLS details needs to be maintained The preferences are maintained for a branch and currency combination The option list will display only those currencies that are marked as a CLS Currency in the Currency Definition screen 7 5 ORACLE 7 1 4 1 Specifying CLS Cutoff Time Specify the following details Trade Cut off Days As a CLS preference you have to maintain the cut off days within which a CLS deal should be completed For instance if you are on 1 April 08 current date and you have maintained 2 days as the cut off period the value date of an FX deal should not be less than 03 Apr 2008 assuming that 02 Apr 2008 is a working day for both the CLS Bank and the deal currency If trade is done after the cut off days the system will display an override message stating the cut off date has passed If you select OK for the override the deal will be saved as a CLS deal Otherwise it will be considered as a non CLS deal Trade Cut off Hour Specify the trade cut off time in hours If you enter into an FX deal on the trade cut off date current system date the system will check the cut off time for the currency On the cut off date the deal should be done within the cut of
34. ORACLE 5 3 1 A Description of the Function Procedures All the accounting entries that are applicable for contract liquidation and initiation defined for the product including maturity initiation brokerage and tax entries will be passed during rollover All the advices that are applicable for contract liquidation and initiation including the Contract Liquidation Advice Debit or Credit Advice will be generated when the contract is rolled over The contract details will be passed on to the Brokerage module to compute brokerage for the rolled over contract 5 3 2 Retrieving Information The Contract Activity report for the day will report the details of contracts that were rolled over automatically during the day If a contract that had to be rolled over was not rolled over for some reason it will be reported in the Exception Report for the day The reason for the contract not being rolled over will also be reported in the Exception Report 22 ORACLE 6 Contract Processing 6 1 Introduction Before you begin foreign exchange operations in Oracle FLEXCUBE you must maintain the following information e Exchange rates e Forward rates e Discounting rates e Netting details This data is required to process the foreign exchange deals that you enter into 6 2 Entering an FX Deal To enter a foreign exchange contract you must invoke the FX Contract Input screen You can invoke the contract input screen from the Applic
35. Otherwise the product should be ALL Branch The branch that you select is identified as a CLS Participant in the FX Branch Parameters CLS Preferences screen This validation will not be applicable if you select the branch code as ALL Parties The different parties involved are maintained in the CLS Directory 7 1 10 1 Specifying the Pay Receive accounts for CLS deals The debit and credit accounts maintained for the module FS and CLS Currency combination will be referred to as the Control Accounts and will be debited credited on liquidation of a CLS FX deal Entries will be posted to the Control Accounts at the individual deal level On receipt of pay out pay in advice from the settlement member you can pass a net entry to the Control Account and post the other leg to the Real CLS Nostro account Refer the Settlements User Manual for more information on maintaining settlement instructions for customers 7 13 ORACLE 7 1 11 Maintaining Alert Preferences for CLS deals You can maintain an alert group for a specific CLS Status The alert will be generated for the selected group of users alone The CLS Alert Group screen is used for this purpose You can invoke the CLS Alert Group Maintenance screen by typing FSDALRTG in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button CLs Alert Group Maintenance Module FS
36. Report Options screen You can invoke the screen by typing the code FXRPCCYA in the field at the top right corner of the Application tool bar and click on the adjoining arrow button Foreign Exchange Currency Analysis Report Options Foreign Exchange Currency Analysis Report Currency All O Single Date Range From Date To Date Include Liquidated Contracts Currency In this field you can specify the currencies for which the report is to be generated If you select e All The net currency position due to contracts involving all currencies that have been allowed for the branch are reported e Single The net currency position due to contracts involving only those currencies that you select in the next field will be included in the report From Date Use the adjoining button to enter the date indicating the beginning of the period for which the report is to be generated For the specified currency ies the net currency position due to contracts maturing between this date and the date given in the next field To Date will be reported The system defaults to today s date To Date Use the adjoining button to enter the date up to which the report is to be generated For the specified currency ies the net currency position due to contracts maturing between this date and the date given in the previous field From Date will be reported The system defaults to today s date This date should be lat
37. Settlement Member with the entries in the CLS NOSTRO Account You may refer the Nostro Reconciliation User Manual for details Reconciliation of the deal with the Settlement Member On the settlement date the Settlement Member will communicate the Settlement Status of the deals in the following manner 8 1 7 1 Web Based Settlement Information The Settlement Member may communicate the Deal Settlement Status on the web You can use the CLS Interface to download the information at regular intervals You may use a batch program for this purpose 8 1 7 2 Information from SWIFT via MT398 The MT398 may be used to communicate all the settlement statuses for the deals on a specific settlement date This message will be generated as part of end of day process A batch program will be executed to upload the information contained in MT398 The settlement status received by Oracle FLEXCUBE can be any one of the following e Settled Deal is settled inside CLS e Due Due for settlement in CLS The upload format for data received from MT398 or from the web browser of the Settlement Member will be as follows Element Id Mandatory Size format Description CLS Yes 1 Settlement Status received from the web Settlement Alphanumeric service The values should correspond to the Status settlement statuses mentioned above Counterparty Yes 10 Deal Counterparty Alphanumeric Our Reference No 20 This can be the Oracle FLEXCUBE Reference Nu
38. Settlement Risk Following are the sequence of steps according to which system identifies a financial anendment e t compares the value of the above listed fields between the upload request and with the values in the base table for the contract that is being amended Even if value of the one field differs then it will consider the entire contract as financial amendment e If the system has identified request as non financial amendment then it will do the amendment using the normal amendment procedure e Ifthe system has identified request as financial amendment then it will do the reverse rebooking of the contract Following special handling will be done for settlement instruction in case of a financial amendment e Ifa non financial request has settlement details then the settlement values sent as part of the upload is uploaded e f settlement details are not sent and if they are maintained as list of amendable fields then system will copy the details corresponding to the parent contract to the child contract e System will not upload a financial amendment if SGEN message is already generated e Incase of financial amendment system will not generate any confirmation message for the reversed deal It will generate the confirmation message as part of processing new deal one ORACLE 6 8 4 Copying contract details From the Contract Detailed View screen you can copy the details of a contract onto a new one Select Co
39. Spot Date For example if the currency pair involved is GBP USD and if you are buying GBP the Spot Date of GBP is displayed here You can change the Spot Date displayed in this field Spot Rate For contracts involving local currency the Spot Rate of the foreign currency is taken as the default Spot Rate For cross currency contracts the rate between the two currencies as maintained in the Currency table is taken as the default Spot Rate If the rate between the two currencies has NOT been maintained the Spot Rate of the P amp L Currency against the local currency is taken as the default Spot Rate You can change the Spot Rate displayed in this field Effective Interest Date This field represents the interest rate which the system computes after considering the spot date and spot rate entered To check if the interest rates of both the bought and sold currencies have been quoted reasonably the premium paid or discount received for that contract is projected into an annualized effective interest rate This rate is calculated by the system based on the total profit or loss for the period from the spot date to maturity date or option date in case an option date is used using the formula Rate P X 360 X 100 S XN Where e P the profit or loss on the contract e S spot equivalent e For non arbitrage contracts sad ORACLE S FCY amount X spot rate For arbitrage contracts S FCY amount X spot rate FCY amt
40. Spread Option Date Internal Remarks Limits Tracking Required Risk Percent 0 Risk Weighted Amount 0 Non Deliverable Forward Detail NDF Currency NDF Fixing Status Settlement Currency P Contract Reference Number External Reference Number User Reference Number Leg Number 1 Related Reference Number Sold Currency Sold Amount Sold Value Date Base Rate Local Currency Spread Definition Outstanding Balance NDF Fixing Date Settlement Amount NDF Basis Track Settlement Risk Track Pre settlement Risk Track Weighted Risk w e o e a Related Reference Number Reversed Reference Number Bill Reference Number Fund Identity Continuous Linked Settlements Eligible Exclude from Continuous Linked Settlements Auto Liquidation Settlement Risk Credit Line Pre Settlement Risk Credit Line Weighted Risk Credit Line Authorized By Date Time j f f l Option Brokerage Change Log Settlement Advices Messages f Charges Tax MIS Contract Status Fields All Messages Cancel Now to input a contract in the screen select New icon in the Application tool bar or click new icon 6 2 2 Input procedures You can enter the details of a contract in two ways You can e Copy the details from another contract and change the details that are different for the contract you are entering or e Enter all the details of the new contract in the contract
41. The contract amount in deal currency Contract Amt in Term CCY The contract amount in term currency Total Buy in Euro The total bought currencies in Euro Total Sell in Euro The total sold currencies in Euro 12 10 ORACLE Receiving Bank Paying The receiving bank and the paying bank Bank Total Buy in Local CCY The total amount bought in local currency Total Sell in Local CCY The total amount sold in local currency The total amount in the two types of contracts Buy or Sell will be reported for each activity both in the contract currency and the local currency The conversion rate specified for the contract will be used for conversion If more than one activity has taken place on a contract the details of the contract are reported under both the activities 12 8FX Contract Overrides Report This report gives details of all contracts on which overrides were given during contract processing You can invoke this screen by typing FXRPOVD in the field at the top right corner of the Application tool bar and clicking the adjoining arrow button 5 Foreign Exchange Contract Over rides Report Foreign Exchange Over rides Report All Contract Over rides for the Day All Over rides for Single Contract 12 8 1 Contents of the FX Contracts Overrides Report The contents of FX contract override details have been discussed under the following heads Header The Header c
42. a new financial year sample entries posted for the event RRVL are as follows Accounting Role Amount Tag Debit Credit Amount GL Indicator Unrealized Fwd REVPROFIT_PY Revaluation Profit Credit 100 P amp L Previous Year Previous Yr Adj REVPROFIT_PY Revaluation Profit Debit 100 GL Previous Year Unrealized Fwd UNAMORTINC_PY Unamortized Income Debit 20 P amp L Previous Year Exchange Profit UNAMORTINGC_PY Unamortized Income Credit 20 Previous Year Refer to Appendix A Accounting Entries and Advices for the FX module for descriptions of Accounting Roles and Amount Tags and for generic event wise accounting entries If you have opted for deal level revaluation reversal while defining FX Branch Parameters revaluation reversal is triggered once before liquidation of a contract This reverses any existing entries in Exchange P amp L GL s as also forward premium discount accruals 4 19 ORACLE Brokerage Allowed You may opt to allow or disallow brokers while creating a product If you allow brokers for a product you can enter into deals that may or may not involve brokers If you disallow brokers you cannot enter deals involving brokers for the product To allow brokers choose Yes by clicking on the button against it To disallow brokers choose No by clicking on the button against it When a deal involving a broker is processed the broke
43. against Currency wise At the time of contract processing the netting type that you specify for the customer will apply to all contracts involving the customer You cannot override the limit netting type during contract booking By default the Risk Netting Type is Currency wise Settlement Risk Select this option to specify that limit tracking is required on the netted amount for all FX being netted on the Customer This option is unchecked by default System considers this field as financial amendment once amendment is done to this field aa ORACLE Settlement Risk Credit Line Select the credit line that should be used for netted settlement risk tracking from the option list provided The list will display all valid credit lines for the counterparty Risk Weighted Risk Select this option to specify that risk weighted limit tracking is required on the netted amount for all FX being netted on the Customer This option is unchecked by default System considers this field as financial amendment once amendment is done to this field Risk Weighted Credit Line Select the credit line that should be used for netted risk weighted limit tracking from the option list provided The list will display all valid credit lines for the counterparty Pre settlement Risk Select this option to specify that pre settlement limit tracking is required on the netted amount for all FX being netted on the Customer This option is unchecked by default
44. alleged deal Select the record and click Linked Reference Number button The system displays the following screen F CLS Status Browser Webpage Dialog wer unt This screen shows all the CLS deals matching the Value Date and Currency mentioned in the Alleged Trade Browser screen From the list select a reference number to be linked The system will default this reference to the alleged deal for matching If a record is modified the system automatically checks the option Modified You can track the modified records based on this status When you save the changes the system validates the changes based on the following parameters e The reference number and resolution status cannot be null e A linked reference number can be linked to a single alleged deal e System does not allow modification of unauthorized records If the validations are successful the system saves the record If any of the above validations fail the system displays an error message and you will not be able to save the changes You can change the CLS and Settlement statuses by unlocking the records Double click a record from CLS Status Browser A to view the following screen 8 7 ORACLE Z CLS Status Browser A Webpage Dialog Reference Number FX2CLFW073370017 Cut Off Date 12 5 2007 Their Reference Number Cut Off Time 13 15 Counterparty FX2000297 Generation Time 2009 09 11 Value Date 12 31 2007 Contract Status A Bought Currency GBP
45. amendment in all fields in a FX contract including counterparty and currencies Setting up the System Before you can process FX deals in Oracle FLEXCUBE you need to maintain certain data that will be used commonly by many deals For example you have to specify the forward and discount rates for currencies the default settlement instructions for a customer etc Such data is maintained in easily accessible static data tables In the following tables you can maintain the data that is required to process foreign exchange deals e Forward Rates Maintenance table forward rates for a currency to be used for Rebate method of revaluation e Discount Rates Maintenance table the discount rates for a currency to be used for NPV method of revaluation A ORACLE e Netting Agreements table where you can specify if you would like to net the foreign exchange deals which are to be settled on the same day with a specific customer e Customer Information Maintenance screen to maintain the clean and total risk for a customer 2 1 2 Organizing Foreign Exchange Deals In Oracle FLEXCUBE you can classify the different foreign exchange deals that you enter into as products For example if your bank enters into spot deals in GBP against USD you can classify this deal type as a product When defining a product you can define the generic attributes of the deal type such as e The type of GLs that would be involved Asset Liability
46. amp Exchange P L INR 100 000 Cr NET GAIN INR 300 000 PROFIT Straight Line Method for discounted products For discounted products you can only apply the discounted Straight Line Method for revaluation When you initiate a forward deal the actual deal amount is considered to be inclusive of the discount notional interest component that you assume to receive and pay over the tenor of the deal Therefore at the time of booking the deal you will specify the Discount Amount that you would receive and pay on maturity for the bought and sold legs of the deal On the Booking date Oracle FLEXCUBE will pass contingent entries for the discounted deal amounts Deal Amount Discount Amount for each leg of the contract 4 2 1 4 Non Deliverable Forward Details Specify the following details NDF Indicator Check this field to indicate whether the product is NDF product or not By default this field is unchecked a ORACLE For forward product type if the NDF indicator is checked then the product is for NDF Forward Contract For spot product type if the NDF indicator is checked then the product is for NDF Fixing Contract Default NDF Currency Specify the Default NDF Currency from the option list This field is activated when the NDF indicator is checked The option list for this field will be list of all BOT and SOLD currency allowed for the branch NDF Basis Specify the NDF Basis from the option list This field is enabled if the
47. are holidays When you run the auto liquidation function on 29 Dec 98 the contracts due on 29 30 and 31 Dec 98 will be liquidated However the contracts due to be settled on 1 Jan 99 will be liquidated on 2 Jan 99 If you have opted for deal level revaluation reversal while defining FX Branch Parameters revaluation reversal is triggered once before liquidation of a contract ae ORACLE 5 2 1 A description of the function Specify the following details Split Value Dates In case the bought and sold value dates for a contract are different the system will liquidate each leg on its value date If a contract that is specified for partial rollover is liquidated the system performs the following functions It e Liquidates only the amount specified for rollover e Invokes the auto rollover function to create the new contract In case of auto rollover e If the rollover function does not complete the rollover of the contract the system does not liquidate the original contract While entering the contract if you indicated that it should be revalued using the straight line method the system calculates the amortizable amount as follows e Total foreign exchange profit and loss the amount amortized to date The system invokes the tax service to pass the accounting entries for tax and passes the liquidation entries to the specified settlement accounts In case of contracts specified for partial rollover only the accounting entries
48. can convert the outflow and inflow into the currency of their choice Such currency trading takes place in an FX market The main participants of the FX Markets are central banks commercial banks corporate players speculators such as investment banks hedge funds etc and to a small extent retail customers Banks have dealing rooms where FX transactions are done by dealers The deals may be struck either telephonically or through sophisticated dealing systems such as Reuters Kondor Smaller banks may also book FX transactions through brokers Once a deal is struck a deal slip is generated which contains basic details of the deal These deal slips are then passed on to the treasury back office for processing accounting settlement and messaging The FX module of Oracle FLEXCUBE is a back office system for the treasury Using this module you can upload the forex deals entered into in the dealing room on to Oracle FLEXCUBE for further processing messaging and accounting You can also enrich the deals with information relating to settlements brokerage tax on brokerage etc The upload facility that Oracle FLEXCUBE offers eliminates discrepancies that could creep into the deal information between the dealing room and the back office system Further not only can you download deals stored in Oracle FLEXCUBE to other systems you can transfer information on Nostro balances etc to the dealing room system that you use Oracle FLEXCUBE allows
49. cancellation On saving the transaction after entering all the required details in the system the system validates the value of the bought sold amount against the following e Product transaction limit oe ORACLE e User Input limit If the transaction currency and the limit currency are different then the system converts the amount financed to limit currency and checks if the same is in excess of the product transaction limit and user input limit If this holds true the system indicates the same with below override error messages e Number of levels required for authorizing the transaction e Transaction amount is in excess of the input limit of the user Deal Rate The Deal Rate is used when the buy currency of the deal is different from the sold currency It will be defaulted from the FX Contract Online screen While liquidating a contract you can choose to change the deal rate When you change the deal rate of a buy type of contract the system automatically calculates the new Sold Amount and displays it in the respective field For instance let us assume that you are partially liquidating a Buy Type of FX Contract The contract amount is USD 2000 The other details of the contract are as follows e Bought Amount USD 2000 e Sold Amount GBP 1000 e Deal Rate 0 5 If you choose to change the Bought Amount to USD 1200 The system does the necessary calculations and displays the Sold Amount as GBP 600 On the other hand i
50. date e Interest Rate On double clicking a row the individual MM transaction will be displayed Pa ORACLE 6 14 1 Validations for Internal Swap Transactions The Buy Sell indicator is from the perspective of the Spot FX deal All other deals will be derived from this The Buy Sell currencies cannot be the same If the Buy Sell indicator is chosen as Buy it will be mandatory to input the interest rate for the Buy leg Placement In such a case the Sell leg interest rate will be disabled If the Buy Sell indicator is chosen as Sell it will be mandatory to input the interest rate for the Sell leg Placement In such a case the Buy leg interest rate will be disabled The Forward Exchange Rate will be a mandatory field The Spot Value Date and Forward Value Date will be mandatory fields If the Buy Sell indicator is Buy the field Buy Amount will remain constant for any combination with Sell Amount and Spot Rate If the Buy Sell indicator is Sell the field Sell Amount will remain constant for any combination with Buy Amount and Spot Rate The user can input any two of the three values Buy Amount Sell Amount Spot Rate The other value will be calculated by the system If the Buy Sell indicator is Buy and the Spot Rate is modified the Sell Amount will be recalculated keeping the Buy Amount constant If the Buy Sell indicator is Buy and the Sell Amount is modified the Spot Rate will be recalculated keeping the Buy Amount consta
51. for Spot FX contracts The revaluation of Spot FX contracts simply involves marking them to market as shown in the following example Example You have bought 1 000 USD against INR in a Spot deal at a rate of 45 INR USD INR is the local currency of your branch USD INR exchange rate changes to 46 in the evening The following accounting entries are passed as part of EOD revaluation Revaluation Profit 46 45 1000 1 000 INR Accounting Role Amount Tag Debit Credit Indicator Amount INR Unrealized Fwd P amp L REVPROFIT Debit 1 000 Exchange Profit REVPROFIT Credit 1 000 If INR appreciated against the USD and the USD INR exchange rate became 44 then the accounting entries passed are Revaluation Loss 45 44 1000 1 000 INR Accounting Role Amount Tag Debit Credit Indicator Amount INR Unrealized Fwd P amp L REVLOSS Credit 1 000 Exchange Loss REVLOSS Debit 1 000 a ORACLE 4 2 1 6 Deal level reversal of Revaluation Entries If you have opted for deal level revaluation reversal while defining FX Branch Parameters you have to run the deal level revaluation reversal batch process before the EOD contract revaluation process is triggered This batch process performs reversal of revaluation entries at the level of individual contracts See the chapter Maintaining Data Specific to the FX Module in this User Manual for more deta
52. for forward deals if it has been allowed for the product it involves If a value date is specified then the maturity date of the deal can be changed to any day on or before the option date Outstanding Balance The outstanding balance for a particular contract is displayed here This is the amount which is not yet Cancelled or Liquidated Internal Remarks Enter remarks about the contract Continuous Linked Settlements Eligible This field will be automatically updated by the system based on certain criteria Only if the conditions are satisfied the deal will be processed via the CLS Bank Otherwise it will be considered as a normal FX transaction Exclude From Continuous Linked Settlements This option will enable you to process a CLS eligible deal as a non CLS deal You have to select the Exclude From CLS option to process a CLS deal as a normal FX transaction Refer the Continuous Linked Settlements chapter of the Foreign Exchange User Manual for details on the maintenances required for CLS deals and processing the same in Oracle FLEXCUBE Auto Liquidation Foreign exchange deals can be liquidated automatically or manually Deals for which you have specified the automatic mode of liquidation will automatically be liquidated on the Value Date during the beginning of day processing by the Automatic Contract Update function If you do not specify auto liquidation for a product you have to give specific inst
53. foreign currency in the pair is taken as the default Spot Date For cross currency contracts the Spot Date of the P amp L Currency is taken as the default Spot Date For example if the currency pair involved is GBP USD and if you are buying GBP the Spot Date of GBP is displayed here You can change the Spot Date displayed in this field Rollover Local Currency Equivalent The local currency equivalent of the amount involved in the contract is displayed here This amount can be changed This is calculated according to the rate maintained in the Currency table For cross currency contracts this amount is calculated as Bought Amount Spot LCY Rate for Bought CCY Sold Amount Spot LCY rate for Sold CCY 2 Rollover Premium Discount For forward contracts this is the Premium or Discount Amount that is applicable as on the date the contract was initiated It is calculated as the difference between the amount in Term Currency as on the Transaction Date and the amount in Term Currency as on the Value Date vee ORACLE The following terms can be different for the new contract e Amount e Value Date e Roll over Date e Roll over Spot Rate After you enter the details click on the Yes button If you do not want to save the details you entered click on the No button 6 2 6 Specifying the Netting Tab Details You can specify the netting preferences in the Netting tab of the FX Contract screen
54. from the Processing sub menu when the details of the contract are being displayed An override will be sought before you can go ahead with the liquidation under the following circumstances e The contract does not have split value dates and the Value Date is a date in the future or e The contract has split value dates and the Value Date of the Buy leg is in the future An override will be sought if the contract has been marked for roll over If you override the contract will be liquidated and not rolled over You will be prompted to confirm the liquidation If you give the confirmation all the related accounting entries will be passed The list of advices that will be generated for the liquidation will be displayed in the FX Advices screen where you can choose to suppress any advice you do not want to generate The advices that are not suppressed thus will be generated when the liquidation is authorized ose ORACLE 6 9 The Liquidation and Cancellation function Through the FX Liquidation Cancellation function of Oracle FLEXCUBE you can cancel or liquidate FX deals either partially or completely You can invoke the Foreign Exchange Payment Input screen by typing FXDPMNT in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Foreign Exchange Payment Input Reference Number User Reference Number Outstanding Amount Currency Payment Details Buy Sell
55. identified in P L CY N the number of days for the profit or loss to be apportioned on a straight line basis It is calculated from the spot date to the maturity date or option date minus 1 This rate is then compared to the difference between the two rates that were entered in Interest Rate Bought Ccy and Interest Rate Sold Ccy If it does not match the system will display an error message and ask for an override Premium Discount This indicates whether the contract results in a premium or a discount Premium Discount Amount The difference between the Spot Equivalent in LCY and the Contract Amount in LCY is the Premium or Discount Amount A minus sign indicates that the contract is at a discount For contracts involving the local currency the local currency is taken as the P amp L Currency When such a contract is revalued the Spot Rate of the P amp L Currency as on the revaluation date is applied on the contract amount to calculate the Spot Equivalent in LCY The difference between the Contract Amount in LCY and the Spot Equivalent in LCY is the Premium or Discount Amount A minus sign indicates that the contract is at a discount For cross currency contracts the Spot Rate of the P amp L Currency as against the other currency is used to calculate the amount in terms of the P amp L Currency The local currency equivalent of this amount is calculated as the Spot Equivalent in LCY The difference between the Contra
56. in the MAIL or TELEX format by the messaging sub system The following information is handed off to the message sub system for the TELEX or MAIL messages Contract Reference Number Product Description Product Slogan for MAIL Deal Currency of the contract Deal Amount Exchange Rate Term Currency Term Amount Counterparty Broker Code Value Date 9 2 2 Contract deal slip The deal slip contains the following information Contract Reference Counterparty Deal Currency Deal Amount Buy Sell Type Value Date Exchange Rate Term Currency Term Amount Split Value Date 9 3 ORACLE 9 2 3 9 2 4 e Broker e Option Date e Transaction Date and Time Contract brokerage advice The contract brokerage advice contains the following information e Contract Reference number e Contract Event e Contract Event Serial Number e Counterparty e Deal CCY e Deal Amount e Term CCY e Term Amount e Exchange Rate e Broker Code e Broker Name e Broker Address e Brokerage Amount If the brokerage amount is amended for the broker the system passes the new amount and triggers a brokerage amendment advice If the broker code is amended the system passes the new broker code and amount and triggers a brokerage reversal advice to the old broker as also a fresh brokerage advice to the new broker FX Swap Confirmation Advice The foreign exchange SWAP confirmation advice is exchanged between financial institut
57. maintenance for combination of risk category FX product combination or risk category FX ALL combination using original tenor of the contract Risk Weighted Amount The risk weighted amount will be displayed here or ORACLE The risk percent will be applied on the bought amount to arrive at risk weighted amount When a contract is copied the limit tracking risk tracking options and credit lines will be copied from the contract The risk percent and risk weighted amount will be zero Whenever the counterparty is changed the credit lines will be made NULL as the credit lines are dependant on the counterparty If credit lines are changed during amendment then the existing utilization will be transferred to the new credit line and the utilization for the old credit line will be made Zero If limits tracking option is unchecked during amendment the utilizations will be nullified for the credit lines The tenor for calculation of risk weighted amount will be calculated based on tenor type Fixed or Rolling maintained at the product The tenor of FX contract will be arrived as follows Fixed Bought value date booking date Rolling Bought value date Branch date During rollover event the tenor of rollover version of FX contract will be arrived as follows Fixed Rollover Bought value date original booking date the tenor will be calculated from the original booking date Rolling Ro
58. maturities A swap could be Spot against forward or forward against forward Risk weighted Amounts Assets which are weighted for credit risk according to formulae usually specified by the central bank The Weights are given in the form of percentages and may vary from 0 to 100 oe ORACLE Internal Swap Swap transaction between the FX and Money Market desks of a bank where in the FX desk buys or sells the currency from to the MM desk Continuous Linked Settlement Continuous Linked Settlement CLS is an industry initiative to eliminate the settlement risk in foreign exchange transactions This is achieved by using a payment versus payment method which provides a simultaneous exchange of currency values through CLS Bank International Spot deal Spot Transaction of Foreign Exchange refers to the foreign exchange transaction settled on usually the second bank working day after the foreign exchange transaction has been concluded Forward deal A foreign exchange deal that is settled beyond the spot days of entering the deal is referred to as a forward deal T ORACLE 12 Reports 12 1 Introduction During the day or at the end of the day you may want to retrieve information on any of the operations related to FX that were performed during the day This information can be generated in the form of reports The following are the reports that you can generate in the foreign exchange module The following are the repor
59. message for the net amount only SGEN event is fired after the NDF Forward Contract is marked as Fixed and FIXG is authorized 6 2 4 3 Processing an NDF Fixing Deal An NDF fixing deal will be booked against an authorized unfixed NDF Forward contract The NDF Related reference number is selected from the option list of all unfixed authorized NDF Forward contract The product for the NDF Fixing Contract is Spot type of product with the NDF indicator set to True While selecting the NDF Forward Contract the following fields are defaulted for an NDF Fixing Contract e The Buy and Sell indicators of the NDF Forward Contract is interchanged in the NDF Fixing Contract and it cannot be modified e The bought and sold currency of the NDF Forward Contract is interchanged in the NDF Fixing Contract and it cannot be modified e The Value date is defaulted and it is same for both the currency e The Counter Party is same customer from the NDF Forward Contract e The Amount in the NDF currency is same in both the deals e The settlement accounts in the Fixing deal are defaulted from those of the original NDF deal e The amount in the settlement currency for the NDF Fixing Contract cannot be same as the amount of the NDF Forward Contract The following are the processing steps for an NDF Fixing Contract 1 The booking of the NDF Fixing Contract will process the FIXG event of the NDF Forward Contract which creates an unauthorized version of
60. netting days will be picked up from the currency definition screen for the bought and sold currency to derive the FX Netting Date for both the currencies Subsequently the earlier of the Netting Date will be used to pickup contracts for netting The netting days will be added to the system date processing date to arrive at the netting date All the contracts with a bought value date sold value date lesser than or equal to the respective netting date will be picked up for netting The FX contracts are netted to upload a consolidated FT contract Netting Process will collate contracts based on the FX Netting Customer EOD Processing During end of transaction input EOTI the system will ensure that as on the system date all contracts have been netted for customers who require manual netting If any contract is found with a bought or sold value date earlier than or similar to the system date where the respective leg is not netted the system will show an error Example The following contracts are entered into by the bank with a customer with whom the bank has a netting agreement Booking Bought Value Bought Bought Sold Sold Sold Date Date CCY Amount Value CCY Amount Date 06 Jan 2009 10 Jan 2009 CAD 2580000 10 Jan GBP 2000000 2009 07 Jan 2009 10 Jan 2009 GBP 3870000 11 Jan USD 3000000 2009 10 Jan 2009 10 Jan 2009 CAD 3000000 11 Jan USD 3840000 2009 These contracts are set for cu
61. not passed by the system Report Period Enter the date indicating the beginning of the period for which the report is to be generated For the selected currencies and products the revaluation details of all contracts for which revaluation was done between this date and the date given in the next field will be reported The system defaults to today s date Enter the date up to which the report is to be generated For the selected currencies and products the revaluation details of all contracts for which revaluation was done between this date and the date given in the previous field From Date will be reported The system defaults to today s date This date should be later than or the same as the From Date specified in the previous field Click OK button to generate the report Click Exit button if you do not want to generate it 12 13 2 Contents of the FX Rebate and NPV Revaluation Report The report options that you have selected currency counterparty and product are given in the beginning of the report The following details are reported for contracts involving the same currency Value Date The settlement date of the contract Contract The Reference number of the contract Reference No Buy or Sell The type of product FCY Amount The contract amount in the foreign currency is displayed for contracts involving local currency For cross currency contracts the amount in the P amp L Currency is
62. on contracts involving only the currency ies you select in the next field will be reported 12 16 ORACLE Currencies The currency codes of all the currencies defined for your branch are displayed here If you have chosen the Selected Currencies option in the previous field you can select the currencies that you want to include in the report The details of revaluation on contracts involving these currencies will be reported To remove a currency from this list uncheck the corresponding checkbox Report For Products In this field you can specify the products for which the report is to be generated If you select e All Products The revaluation details on contracts involving any product will be reported e Selected Products The revaluation details on contracts involving only the product s that you select in the next field will be reported Products A list of all the products that are used in the branch is displayed here If you have chosen the Selected Products option in the previous field you can select the products that you want to include in the report The details of revaluation on contracts involving all these products will be reported To remove a product from this list uncheck the corresponding checkbox Revaluation e Actual Details of revaluation performed through the Straight Line Revaluation method will be reported e Memo Revaluation for all contracts as of the last Memo revaluation
63. than alleged trades e Resolution Status Pending or Closed e Funding Cut off Date The funding cut off date for the deal currency e Funding Cut off Time The funding cut off time in the deal currency e Linked Reference number The Reference Number of the contract that is booked in Oracle FLEXCUBE to close the alleged status e Their Reference Number Reference Number of the Counterparty or the Settlement Member e Value date The maturity date of the deal e Counterparty Deal Counterparty e Bought Currency The buy currency of the deal e Bought Amount The buy amount in the buy currency e Sold Currency The sell currency of the deal e Sold Amount The sell amount in the sell currency e Exchange Rate Deal Exchange Rate e Message Receipt Time The time when the Alleged Status was received in Oracle FLEXCUBE 8 1 3 1 Modifying CLS Statuses for Alleged Trades You can unlock and modify the CLS status information pertaining to alleged trade records Select one or more alleged deals to be modified and click unlock button With this action the system will disable the fields Value Date and Currency 8 6 ORACLE You can modify the resolution status provided under the alleged trade multi record block Once you have made the changes click Assign button System will assign the modified resolution status to the selected records Using this screen you can also link a CLS deal reference number to a single
64. the payment Oracle FLEXCUBE supports NDF functionality for FX contracts The settlement for the NDF forward contract will be for NDF net settlement amount in the settlement currency which is the difference between the settlement amount exchanged and the amount at the fixing rate The fixing rate will be provided on the fixing date Example The minimum contract size is USD 10 000 The tenor of the contract is for 1 2 3 6 month or 1 year No handling fee is charged Customer Mr A View on RMB RMB will appreciate against USD in the future NDF Contract Customer Buy RMB Bank Sell RMB Customer Sell USD Bank Buy USD Contract Date 1 November 2009 Tenor 1 month Valuation Date 29 November 2009 Settlement Date 1 December 2009 Forward Rate USD 1 against RMB 8 03 Nominal Value USD 100 000 Required USD 100 000 or its equivalent in any other foreign Deposit currency Case 1 The spot rate at the Valuation USD1 against RMB 8 000 RMB appreciates against Date USD Settlement Amount USD 100 000 8 03 8 000 8 000 USD 375 Mr A will gain on the settlement date USD 375 when RMB appreciates against USD Case 2 ele ORACLE The spot rate at the Valuation USD1 against RMB 8 060 RMB depreciates against Date USD Settlement Amount USD 100 000 8 030 8 060 8 06 USD 372 20 Mr A will lose USD 372 20 on the settlement date when RMB dep
65. to a counterparty you can generate an FX Payment message These messages are generated by the messaging sub system in Oracle FLEXCUBE The following are the messages that you can generate for a counterparty e FX Payment messages gt FX SWIFT payment message gt FX Telex payment message gt FX Mail payment message e FX Receive messages ou ORACLE 9 3 1 Generating Payment Messages Payment messages are generated by the messaging sub system when a payment is made to a counterparty at the time of contract e Takedown e Amendment e Interest payment e Liquidation You can configure payment messages to suit the medium of communication You can configure payment messages to suit the SWIFT TELEX and the Mail mediums SWIFT messages The format of the SWIFT messages that you generate for a counterparty would depend on the mode of settlement and whether the counterparty is e An individual or e A bank You can generate SWIFT messages in the following formats e MT100 e MT200 e MT202 e MT205 A SWIFT message provides the following information to the counterparty e The contract reference number e The value date currency code and the amount e The counterparty e Remarks Telex messages Telex messages contain the following information e The contract reference number e The product description e The currency e The counterparty e The contract amount oe ORACLE e The direction of funds e The event code e Th
66. 1 Contents of FX Disposition REPOrt cccccccccscseesseecesecesecesecesecesecacenaecaecaaecaeecaeeeaeeeaeeeneeeeeeeeenaeeeaes 12 5 12 5 FX TENOR WISE CURRENCY POSITION REPORT ssccecsesececseccecessececseneececseneeceeaeeecsesaeeecsneeecessnreeenaes 12 6 12 5 1 Contents of the FX Tenor wise Currency Position Report csccesccsseesseesseeeeeneeeseeeseeeeeeseseeneeneeaes 12 7 12 6 UNCONFIRMED FX CONTRACTS REPORT cssssssecesssececeesaeeecseececeeuececsenaececseneecesaueeecsesaeeesseeaecessaeseseeaes 12 8 12 6 1 Contents of the Unconfirmed FX Contracts R pOrt csccscsccsssssssesseesecssesecuseseesecuseesesaeeneesesaeeecnseees 12 8 12 7 FX CONTRACT DAILY ACTIVITY REPORT sicc cc cssceccsciscacccersceces csscbeceskecaccocbacecadshicedas ia aaa as Eae 12 9 12 7 1 Contents of the FX Daily Activities R POTt cccccsccescese cess ene eneeeseeeseeeeeeseeeeensecaecaeceaecaaeeaeeeneees 12 10 12 8 FX CONTRACT OVERRIDES REPORT irori seedade e aeaa aE ae Aa e a e aa OERE AEE 12 11 12 8 1 Contents of the FX Contracts Overrides Report ccscccsccescsseeseesseeseeseeeeeeeeeeseeeeeenseeeseenaecnaeenaeens 12 11 12 9 FX BROKERAGE DETAILS REPORT 0 cissiscsccccacoc cis seccecsacacscerscecesesactecesuueivesstalacasstbeasesdbacecescttcuvasdbacsseccubess 12 12 12 9 1 Contents of the FX Brokerage Details Report cccsccesccesecsseesseeseeeseesseeseeeeeeeeeeseenecesecnaesnaeenaeens 12 13 12 10 FX ROLLOVER DUE REPORT iisccccscceccscl
67. 14 1 Validations for Internal Swap Transaction cscesccesesscesesseeneeseeseesecaeesecsceeecseeseesecseeseceeeeenaeeaeeaees 6 74 6 14 2 Processing Internal Swap Transactions ccccccescese sete ceseenseesseesseeeeeseeeeeeesecesecnsecuaeceaecaaecaeseseeeneees 6 75 7 CONTINUOUS LINKED SETTLEMENTS CLS ccssssssscscesscescsssscsssencsscsscenessessesssssseesssssessssnesees 7 1 7 1 INTRODUCTION 22 seed deabssdiciiisces deatshacvabects abesedciab ETEA EEE E EET AEEA TETEA E a EAEE E E EEEE 7 1 7 1 1 Maintaining CLS Preferences for the Branchy c scccscccscsccessseecseescesseesecesecesecesecsecaeeeaeeeseeeseeeeeeeeteaees 7 2 712 Allowing a Currency to be Settled Inside CLS ccssccssescsssesseseeseesecsceecuceeeeuseeseesecaeesesaeeeeeneeenseaeenes 7 4 7 1 3 Identifying the customer as a CLS Participant and maintaining currency restrictions secese 7 4 7 1 4 Maintaining CLS currency preferences for the branch w sisccescecseecseescesecssesecnseeseeseeseeseeacenscneeensnaeenes 7 5 7 1 5 Specifying UDE Values cenicienta A E EE E EAE E EAN 7 7 7 1 6 Maintaining Holidays for CLS Bannk u cc cccccsccssssssssecssesscuseesenseseeceseeseesecaeeseesceesesaeecesseeaeeecnaeenseasenes 7 8 7 1 7 Specifying UDF Values wiccccisecssnsdscetenctsccvsnsautcsuc outessresetocbiuensaeldaspanebvateisddycsPoresuepsbe agessteedsesvipsueeticesses 7 9 7 1 8 Maintaining the participant type for CLS CUStOMETS cccecceeceeeceeecesecusecnseceeeaeeeaeeeseeeeeeenene
68. 2 1 2 1 2 Organizing Foreign Exchange Deals scccscccsceesseesseeceeecesecesecescesscesecesecaecasecauecseeeseeeseeeeeeeneeenenaees 2 2 2 1 3 Specifying the BrOKera Be resni iina e vba e E vege buena EEE ENEI 2 2 2 1 4 Definim TAN Senere a E a A ake O Bey 2 3 215 Trackin o LAMUS oers p tena iecdetnten sances a a teancdeeds nenaeetvatgentees O eE e Ee OA 2 3 2 1 6 WELLING FX CONTAC sirien ai E a T E A a a EE a a 2 3 2 1 7 Retrieving Information Relating to FX deals cecesccecccesssecesseenseceeseeenseceeacecsseceeneecaecseaeecnseeeeaeecnaeeeeaes 2 4 3 MAINTAINING DATA SPECIFIC TO THE FX MODULE sesesersceseeroesesececoesoroesesecocoerorosseseceeoeseseceeoesoee 3 1 3 1 INTRODUCTION pisici meranen eaaa EEE Sucesvostesdcatsbuecueavaesaovaesecdssnaeecepsauaestesswencavesueecteessaueeves 3 1 3 1 1 St tic D ts aee ER a EEEE E E e E EERE 3 1 3 2 MAINTAINING BRANCH PARAMETERS isc ssssessecoaceccoveosesiscunsecesteaceesecascucestencessesnsdacsatevcoteostorecsdcbuceecotendesisey 3 2 3 2 2 Maintaining CLS preferences for the branch ecccsccesceesseeseeeeeeecesecesecesecusecaecasecseeesecaaecaeeseeeaeeeaees 3 4 3 2 3 Specifying UDF Values airaa a spives A E A E E R E E 3 5 3 3 MAINTAINING FORWARD RATES 03 2053 55 cas sebveccscsscsdcevebescscusteccudeucensecasducescencesaesnsdecscdesgeteestodecaiebnenscoseoded sees 3 5 3 3 1 Maintaining forward rates for currency paitS essessseeeesseereereeesrsesrrerereseseserrerieresesesrsreereresrsesrerse 3 5
69. 2 7FX Contract Daily Activity Report This report gives details of activities that were performed on contracts in the FX module during the day If the report is generated as a part of End of Day process all the activities during the day will be reported If it is generated any other time you can select the product and the type of activity initiation putting a contract on hold amendment reversal rollover liquidation etc to be reported in the Report Options screen You can also invoke this screen by typing FXRPDLY in the field at the top right corner of the Application tool bar and clicking the adjoining arrow button Foreign Exchange Daily Activity Report Options Foreign Exchange Daily Activities Report Activities All O Single Activity jaz Report For In this field you can specify the activities for which the report is to be generated If you select e All Activities All the activities that have been performed during the day will be reported e Selected Activities Only those activities that you select in the next field will be included in the report Activities If you have chosen the Selected Activities option in the previous field you can select the activities that you want to include in the report a ORACLE The details of contracts on which these activities have occurred will be reported To remove an activity from this list uncheck the corresponding checkbox Click OK to generate the r
70. AEE REENER E EEEE 6 1 6 2 1 Invoking the Sere ttisierssesieiiriiiiii n e ne EEE EEEE NANO 6 1 6 2 2 Input PrOCEAUTES i ccsscssowssucssiescisedsvstieevbetegusngivestenievei sia ycebsteabstegn EE EEE ENAN R 6 2 6 2 3 Specifying the Main Tab Details ccsccsccsccssesssesecscesecssesecssceccesecasenesaeensesecacesecuceeessaseneaecaeesesenseas 6 4 6 2 4 The exchange PALE TYP 2 ez ccssesievesscswievetescesueienty osvassdsudteneusebeansbeiedveetyes E ER E E ETRE 6 9 6 2 5 Specifying the Rollover instructions Tab Details cccccccccssseescessceseceecnsecuseeeeeaeeeseeeseeeeeeeeeeaees 6 20 6 2 6 Specifying the Netting Tab Details ccccccesccesesseeseesseeeceeeceeeceseceseceaeceesaeceseceaecsaecsaecaeeeaeeeseeenees 6 23 6 2 7 Process of updating of Limit Tracking Options sccccssccscesceseeceseescesecsesecnceeecsseeeeesecaceseceeeeeeaeeneeas 6 26 6 2 8 Mantal Netting iwicicseicsevstescviesesietacitsnaeses duce a e a A E REEE EEE ERE ETI beaut ERRA 6 27 6 2 9 Automatic and Manual FX Netting Batchii sccccsccscsccssssssssesssesecsseeecuseeecseescesecaceecesecaeesesaeeeeenaseeeeaees 6 28 6 2 10 Capturing the Revaluation Tab Details cceccescsscssscssesecseesceseeseesecaseecuseeeeseesceaesseeeeaeeaeeeeeneeseees 6 30 6211 Saving the Contract You Entefed siiissiissikiniisreini iiini a Ea 6 34 6 2 12 Processing a Contract Involving a Product Combination ssseeeeseseeeseesenessreeeeeeererereresrsreesesess 6 34 6 2 13
71. Authorization of the new contract will authorize the parent contract It is not possible to delete or authorize the reversal of the parent contract reference number without deleting or authorizing the child The Confirmation message of the parent message will be suppressed if the counterparty of the parent contract and the current contract are the same In case the counterparty of the parent and child are the same and if the parent contract is confirmed then the child will also be marked as confirmed If the parent is not confirmed then it will be marked as confirmed and the incoming confirmation will be matched with the child contract oe ORACLE 6 8 9 Putting a Contract on Hold If you do not have all the details of the contract you are entering you can put it on Hold instead of saving it No accounting entries and advices are generated for a contract that is on Hold You need not authorize a contract that is on Hold During information retrieval such a contract will be reported as Held When all the details about the contract are available you can remove the Hold status from the contract and store it This activity can be performed on the same day on which the contract was put on Hold or on any subsequent day Removing the Hold status on a contract To store a contract that has been put on Hold you should Copy it onto another contract Select Copy icon at the Contract Summary View when the contract on Hold is highlight
72. CLS status and CLS settle status to the selected records If a record is modified the system automatically checks the option Modified You can track the modified records based on this status When you save the changes the system validates the changes based on the following parameters e The reference number and CLS status should not be null e The CLS statuses Rescinded or Failed cannot be changed e The CLS status Mis Matched can only be updated as Mis Matched Rescinded or Failed e System does not allow modification of unauthorized records If the validations are successful the system saves the record If any of the above validations fail the system displays an error message and you will not be able to save the changes Viewing CLS Status Information for Alleged Trades You can view and modify the CLS status and other details of the alleged deals using Alleged Trade Browser screen 8 5 ORACLE To invoke the screen type FSDSTBRA in the field at the top right corner of the Application tool bar and click the adjoining arrow button Alleged Trade Browser Yalue Date Currency Alleged Trades T Modified Resolution Status Fund Cut Off Date Fund Cut Off Time Linked Reference Number Their Reference Number _Refere Resolution Status Pending You can query the CLS details from this screen The following details will be displayed for deals other
73. Confirmation Status Confirmed Bought Amount CLS Status Un Matched Sold Currency USD Settlement Status Sold Amount Exchange Rate Input By Date Time E Authorized Authorized By Date Time iv Open You can unlock this screen and modify the following fields e CLS Status e Settlement Status Similarly double click a record from CLS Status Browser B to view the following screen F CLS Status Browser B Webpage Dialog Linked Reference Number Cut Off Date Resolution Status Closed Cut Off Time Their Reference Number Exch Rate Counterparty Generation Time Value Date Bought Currency Bought Amount Sold Currency Sold Amount Input By Date Time Modification Number WB authorized Authorized By Date Time Open Here again you can unlock this screen and modify the following field e Resolution Status The status changes thus made have to be authorized by another user i e the maker and checker cannot be the same individual Archiving and Purging of records in the browser During the end of day run at the branch the system will archive the records displayed in the browser if their status is as follows 8 8 ORACLE e Contract Status Reversed e Authorization Status Authorized e CLS Status Rescinded Failed or Matched In addition the value date should be less than the system date inclusive of the Retention Period defined for the status Archival of CLS Browser Data Arc
74. Contract Online screen and FX Liquidation Cancellation screen will be displayed depending on the event that is unauthorized 6 8 17 Rolling Over a Contract Manually A contract that has not been marked for Auto Roll over has to be rolled over manually through Rollover in the Processing sub menu To be rolled over into a new contract a contract has to be e Authorized e Should be past its Value Date but unsettled By default the contract will be rolled over with the same terms as the original contract However you can change certain terms through the Roll over Instructions Screen If you have given any rollover instructions they will be displayed In either case you will be prompted to confirm the rollover All the terms of the contract including the brokerage and settlement details will be attributed to the new contract Two activities take place when a contract is rolled over the original contract is liquidated and a new contract is initiated The validations that are performed when a contract is rolled over will be those for the liquidation and initiation of a contract If the liquidation of the original contract cannot be done for some reason the new contract will not be initiated ove ORACLE The authorization session for a manual rollover involves the authorization of two operations the manual liquidation of the original contract and the initiation of the new contract Authorizing a roll over When a contrac
75. Currency Description FX Settlements Description Product laz Continuous Linked Settlements Description atus Alert Group Detail oO User ID Available Fields Input By DOC4 Date Time Modification Number BB Authorized ance Authorized By Date Time E open The alert group is defined for a combination of Branch Module Product Currency and CLS Status The values of the fields should be as follows Module This defaults to FS Foreign Exchange Settlements Product Select a specific product or else ALL Currency Select a specific currency or ALL CLS Status The CLS Status for which you require the alert If the status of a CLS deal or an alleged trade is updated to the CLS status maintained in CLS Alert ZGroup Maintenance the system generates an alert to the specific users User Id Available From the available list of user ids the list will contain only those user ids for which the CLS participant branch is the home branch you have to select the users who have to receive the alert for any deal that is with the above status You can select the users whose home branch is the CLS participating branch itself The selected users will receive alerts for deals with the CLS status maintained 7 14 ORACLE The product and currency combination should be as follows Product Currency Specific Specific Bought Sold Specific ALL ALL ALL ALL Specific Bought Sold
76. Debit Credit Indicator UNRLZ FWD P amp L Unrealized Asset REVPROFIT_PY Credit Fwd P amp L Liability Revaluation Profit Previous Year UNRLZ FWD P amp L Unrealized Asset REVLOSS Debit Fwd P amp L Liability Revaluation Loss EXCHANGE LOSS Exchange Expense REVLOSS Credit Loss Revaluation Loss UNRLZ FWD P amp L Unrealized Asset REVLOSS_PY Debit Fwd P amp L Liability Revaluation Loss Previous Year EXCHANGE LOSS Exchange Expense REVLOSS_PY Credit Loss Revaluation Loss Previous Year For Forward Contracts with Straight Line Revaluation Accounting Role Type Amount Tag Debit Credit Indicator EXCHANGE PROFIT Income REVPROFIT Revaluation Profit Debit Exchange Profit UNRLZ FWD P amp L Asset REVPROFIT Revaluation Profit Credit Unrealized Fwd P amp L Liability EXCHANGE PROFIT Income REVPROFIT_PY Revaluation Debit Exchange Profit Profit Previous Year UNRLZ FWD P amp L Asset REVPROFIT_PY Revaluation Credit Unrealized Fwd P amp L Liability Profit Previous Year UNRLZ FWD P amp L Asset REVLOSS Revaluation Loss Debit Unrealized Fwd P amp L Liability EXCHANGE LOSS Expense REVLOSS Revaluation Loss Credit 10 9 ORACLE Accounting Role Type Amount Tag Debit Credit Indicator UNRLZ FWD P amp L Asset REVLOSS_PY Revaluation Debit Unrealized Fwd P amp L Liability Loss Previous Year EXCHANGE LOSS Expense REVLOSS_PY Revalua
77. Details You can enter the text of the payment details that you would like to generate along with the outgoing FT in this field 3 5 2 Specifying UDF Values You can associate values to all the User Defined fields created and attached to the Netting Agreement screen You can view the list of User Defined fields associated to this screen by clicking Fields button on the Foreign Exchange Netting Agreement Maintenance screen User Defined Fields User Defined Fields C Field Name O ce You can enter the value for the UDFs listed here in the Value column For more details on how to create user Defined fields refer chapter Creating custom fields in Oracle FLEXCUBE in the User Defined Fields User Manual under Modularity 3 5 3 Maintaining FX Risk Netting Details For FX transactions covered by netting agreement the limit tracking should be carried out for the netted amount for the following risks e Settlement Risk e Pre Settlement Risk e Risk Weighted Risk oe ORACLE You can do this using the Foreign Exchange Netting Limits Maintenance screen You can invoke the Foreign Exchange Netting Limits Maintenance screen by typing FXDLMNET in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Foreign Exchange Netting Limits Maintenance Foreign Exchange Risk Netting Agreement Customer Number EBI Risk Netting Type Pai
78. FT netting To invoke the screen type FXRPNTF in the field at the top right corner of the Application tool bar and click the adjoining arrow button Foreign Exchange To Funds Transfer Netting Report Report Type By Value Date By Netting Date Al From Date O Range To Date Customer All Customer O Single 12 24 1 Contents of the Report The contents of FX to FT netting report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report as ORACLE Body You can find the following details in the body of the report Value Date The date on which contracts are to be settled Customer The code that identifies the customer FT Reference No The reference number of the FT contract Netting Reference No The netting reference number of the contract CCY The currency involved in the transaction Amount The amount involved FT Reference No The reference number of the FT contract Netting Type The type of netting used Upload Status The upload status Amount The amount involved in the transaction Netting Status The status of netting i e fully partially 12 25 Process Exception Report Process exception repor
79. Foreign Exchange Version 11 1 INT1368 ORACLE FCUBSV UM 11 1 0 0 0 0 0 August 2010 Oracle Part Number E51575 01 ORACLE FINANCIAL SERVICES ORACLE Document Control Author Documentation Team Group UBPG Created on October 01 2008 Revision No Final Updated by Documentation Team Reviewed by Approved by Software Quality Development Testing teams Assurance Team Updated on August 13 2010 Reviewed on August 06 Approved on August 06 2010 2010 ORACLE Foreign Exchange Table of Contents 1 ABOUT THIS MANUAL 1 cceccescscscececencsscsnsscsssssnscsssnessssncssesscssosssssnsssssnesscsnessesensseesesenesesssessossessosensss 1 1 1 1 INTRODUCTION f 505 250s iescaessolebssvetes tavsssbtvncvedesshayatinebsonevesdanenatbaponeds E od epenbabssvedes sabsenveeees 1 1 1 1 1 VEVA E E A A E E E E E E E E E E TA 1 1 I 1 2 Org niz ti ON soseen essin aeo esin nE N eE ee AE A aE R NEE EE E AAEN ESEE ANA EE EREE EEEE EENS 1 1 1 1 3 Related documents c cecccescceseceseesseesseeseesseessescesecuseceaeceaecsaecssecseecseeeseesseeseeeaeeeneeeeeeeeeeeeeseceeeeeeeeaeees 1 2 1 1 4 Glossary Of ICONS sssri us nirisan aiani eaae aE E EEN EEE RE E A R OOE EEE EEE E 1 2 2 AN OVERVIEW OF THE FOREIGN EXCHANGE MODULE essesseseseeeccesoroesesecocoesoroeseseeeeoesoroeseseceee 2 1 2 1 INTRODUCTION csessss Scssiystastisesdisiehs ESEE EEEE Ea NES E NR EEA EES EEEa 2 1 2 1 1 Setting UP Me System iiien a n e e E E EIER EE EEN A R
80. Forward Contract reference number It is a mandatory field for the NDF Fixing Contract It is NULL while booking the NDF Forward Contract and while booking the NDF Fixing Contract it is set to NDF Fixing Contract Bought Currency Specify the currencies that are involved in the contract Indicate the currency that you are buying The adjoining option list displays all the currencies that are allowed for the product Choose the appropriate one Sold Currency Specify the currencies that are involved in the contract Indicate the currency that you are selling The adjoining option list displays a list of all the currencies that are allowed for the product Choose the appropriate one Bought Amount Adjacent to the Currency field is the Amount field You must enter the bought amount of the bought currency here Against the Bought currency enter the bought amount in the Amount column You can enter the amount in numerals and then enter e T to indicate that the amount is in thousands e M to indicate that the amount is in millions e B to indicate that the amount is in billions On saving the transaction after entering all the required details in the system the system validates the value of the bought amount against the following e Product transaction limit e User Input limit If the transaction currency and the limit currency are different then the system converts the amount financed to limit currency and check
81. IXINGSTATUS_ NDF Fixing Status _NDFSETAMTDR_ Debit Indicator _NDFSETAMTCR_ Credit Indicator _RECEIVER_ Receiver information _RECEIVER1_ Receiver information 1 10 4 ORACLE MSG_TAG Remarks _RECEIVER2_ Receiver information 2 _RECEIVER3_ Receiver information 3 _SENDNAME _ Sender Name _SENDER1 _ Sender Address 1 _SENDER2_ Sender Address 2 _SENDER3_ Sender Address 3 _SYSDT__ System Date _PRODDESC _ Product description CONTREFNO __ Contract Reference number _BOOKDT_ Booking Date _EVENTDT_ Event Date _BOTCCY_ Bought Currency _NDFSETAMTCR_ Credit Indicator _BOTAMT_ Bought Amount _BOTVALDT_ Bought Value Date _EXCHRATE_ Exchange Rate _SOLDCCY_ Sold Currency _SOLDAMT_ Sold Amount _SOLDVALDT_ Sold Value Date _SENDACINSTN1_ Acct with Institution 1 _SENDACINSTN2_ Acct with Institution 2 _SENDACINSTN3_ Acct with Institution 3 _SENDACINSTN4_ Acct with Institution 4 10 5 ORACLE 10 5 1 1 10 5 1 2 10 5 1 3 Accounting Entries Nil Advices AMND Amending Advice Name Description FX_BROKAMND Brokerage Amendment Advice FX AMENDMENT Amendment Advice CANC Cancellation Accounting Entries Accounting Role Amount Tag Dr Cr Indicator CONTINGENT BOT BOTAMT Credit CONTINGENT SOLD SOLDAMT Debit Advices Advice Name Description
82. Intermediary Account with Institution Sequence C Final Settlement The same information as in Sequence B but for the final leg of the contract 9 2 5 Contract amendment advice You can generate an amendment advice for any change to an authorized contract if it affects The amount Exchange rate Settlement instructions Contract date value date or option date os ORACLE The original and changed information relating to the above field will be passed to the messaging sub system 9 2 6 Roll over advice You can print a roll over advice for a counterparty at the time of contract roll over The advice contains the following information e Old Contract Reference Number and Maturity Date e Old Contract Deal amount Term Amount and Exchange Rate e New Contract Reference Number and Maturity Date e New Contract Deal Amount Term Amount and Exchange Rate e Roll over Date e Deal Currency e Term Currency e Event Keyword e Event Serial No 9 2 7 Reversal advice When you reverse a contract you can print the reversal advice The reversal advice contains the following information e Contract Reference Number e Event Serial No e Event Keyword e Contract Date e Exchange Rate e Value Date e Currency Bought e Amount Bought e Amount Sold e Currency Sold e Value Date Sold oe ORACLE 9 2 8 Advice of Cancellation MT292 9 3 In Oracle FLEXCUBE when you enter into a Foreign Exchange deal either for yourself or on be
83. MM or FX whose contracts have to be authorized On selection of the module all unauthorized contracts pertaining to that module will be displayed in the grid Ignore Overrides Check this box if you want the system to ignore the overrides generated at the time of authorization If the overrides of the contract are not authorized system displays an error message oe ORACLE For example if the maturity date of a contract is 30 December 2009 and is a holiday for your bank system will display an override 30 DEC 2009 is a holiday However you can opt to ignore such overrides by checking against Ignore Overrides Generate Messages Check this box if you want the system to generate messages associated with authorization On authorization of a contract the messages associated with the contract will be generated 6 8 13 Authorizing the Contracts You can either opt to authorize all the contracts that are displayed or choose only certain contracts for authorization e To authorize only specific contracts check against the boxes positioned before each contract reference number e If all the contracts that are displayed have to be authorized check against the box positioned before Contract Ref No 7 Bulk Authorization Detailed Web Page Dialog E 2 x a Module Fx IT Ignore Overrides I Generate Messages Unauthorised Contracts i m Contract Ref Number User Ref Number Counterpa
84. Minute Specify the cut off time in minute for the making the funds available Specifying UDF Values You can associate values to all the User Defined fields created and attached to the CLS Currency Details screen You can view the list of User Defined fields associated to this screen by clicking Fields button on the CLS Currency Details screen User Defined Fields User Defined Fields Cll Field Name oye You can enter the value for the UDFs listed here in the Value column For more details on how to create user Defined fields refer chapter Creating custom fields in Oracle FLEXCUBE in the User Defined Fields User Manual under Modularity 7 7 ORACLE 7 1 6 Maintaining Holidays for CLS Bank You can maintain a holiday calendar for the CLS Bank through the CLS Holiday Calendar Maintenance screen You can invoke the CLS Holiday Calendar Maintenance screen by typing FSDLCHOL in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button CLS Holiday Calendar Maintenance January February April August October November Year p007 Input By DOC4 Date Time Modification Number Authorized By Date Time June September December Refresh At the time of booking a CLS deal the system will use the CLS Bank holiday calendar to check if the value date of the contract falls on a holiday If the value date falls on a holida
85. NDF Forward Contract Authorization of the NDF Fixing Contract will authorize the unauthorized version of NDF Forward Contract Deletion Include version delete Amendment Reverse The following are the operations carried out for an NDF Fixing Contract e The Save operation executes the unauthorized FIXG event of the NDF Forward Contract e The Authorization operation will change the authorize status of an unauthorized FIXG UFIX event of the NDF Forward contract to authorize status and generates advice associated to FIXG UFIX oe ORACLE The Liquidation event for the NDF Fixing Contract does not have accounting entries It only marks the contract as liquidated While Amending if LIQD SGEN have been fired for NDF Forward contract then the NDF Fixing Contract cannot be amended Otherwise it executes another version of FIXG event for NDF Forward Contract with new settlement amount and the fixing status as fixed While Deleting the NDF Fixing Contract it deletes unauthorized FIXG event for the NDF Forward Contract While Reversing the NDF Fixing Contract an unauthorized UFIX event is executed for the NDF Forward Contract The NDF Fixing Contract cannot be copied The table below explains the operations carried out and corresponding action undertaken for the NDF Forward Contract and the NDF Fixing Contract NDF Forward NDF Fixing Action Contract Contract BOOK Authorized Book Execute t
86. NDF indicator is checked NDF basis is used to generate the NDF advices for the NDF Forward contract 4 2 1 5 Specifying Revaluation details for FX Spot and Forward Contracts Revaluation is the process of stating your foreign currency assets and liabilities in terms of the current exchange rates Revaluation of your foreign exchange assets and liabilities can result in either a profit or a loss for your bank This is because the equivalent of the foreign currency assets and liabilities in the local currency would be recorded in the books at rates other than the current exchange rates and converting the assets and liabilities to the current revaluation rate would result in a change in the local currency equivalent amounts This change can be a profit or a loss Foreign Exchange Product Preferences Product Code Description Preferences Additional Auto Liquidation Allowed Split Value Dates Allowed Yes O No Brokerage Allowed Extension Allowed Yes O No Cross Currency Deals Allowed Local Holiday Check Yes No Revaluation Yes No Frequency Daily Monthly Rollover Allowed Cancel Specify the following details Revaluation To allow revaluation of deals involving a product choose Yes by clicking on the button against it You can disallow revaluation by clicking on the button against No 2 ORACLE Frequency If you allow revaluation of your foreign c
87. Netting Reference Number The reference number being used to utilize the limit for the netted amount for the sold leg will be displayed here Fund Transfer Reference Number The reference number of the funds transfer used for netting the bought leg is displayed here ee ORACLE Netting Reference Number The netting reference number of the sold leg is displayed here Funds Transfer Status The status of the funds transfer involved in the netting of the sold leg is displayed here 6 2 6 3 Specifying Netted Limit Tracking details You can also specify if Netted Limit Tracking is required for the FX contract Settlement Risk You can specify whether settlement risk tracking should be done on the netted amount for all FX being netted for the customer This will be defaulted from the Limits netting agreement Risk Weighted Risk You can specify whether risk weighted limit tracking should be done on the netted amount for all FX being netted for the customer This will be defaulted from the Limits netting agreement Pre Settlement Risk You can specify whether pre settlement risk tracking should be done on the netted amount net of revaluation gain loss for all FX being netted for the customer This will be defaulted from the Limits netting agreement Risk Netting Type The netting type will be displayed here This will be defaulted from the limits netting agreement of the counterparty or FX netting group customer 6 2 7 Process of u
88. ORACLE Gain Loss for USD Date Amount after revaluations Gain Loss 31 Jan 50 000 1 01 50 500 50 500 50 000 500 28 Feb 50 000 1 02 51 000 51 000 50 500 500 Total Gain Loss 500 500 1000 EUR Accrual entries for 31st January For GBP Dr Interest receivable bought currency 1050 85 LCY Equiv 1050 85 1 02 1071 87 C a Interest Income 1050 85 At the spot rate of 1 02 The interest of 2000 GBP is obtained for a period of 59 days 31 days of Jan and 28 days of Feb and is distributed between the schedules depending on the number of days in each schedule For instance interest for the first schedule 31 days 2000 31 59 1050 85 Interest for all other schedules is calculated in a similar manner For USD Dr Interest Expense 525 42 LCY Equiv 525 42 1 01 530 68 Cr Interest Payable on sold currency 525 42 At the spot rate of 1 01 Revaluation entries for 31 January Booking the gain on GBP receivable on the discounted deal amount 48 000 D Discounted bought amount 960 EUR C a Revaluation gain unrealized 960 EUR Booking the gain on USD payable on the discounted deal amount 50 000 Dr Revaluation gain unrealized 500 EUR Cr Discounted sold amount 500 EUR a On the settlement date 28th February the following entr
89. P Currency GBP az Charges Details Ourselves Payment By v Payment By m Benificiary Shared Pay Parties Pay Parties Receiver Parties Cover Parties Clear Details Cover Detials Other Details Intermediary Reimbursement Institution lt lt Intermediary aze P P i e Country az Country Fal RTGS Payment RTGS Network Date Time Modification Number Input By DOC4 Cancel Authorized By Date Time You have to maintain the settlement instructions exclusively for CLS deals For this you have to select the module FS FX Settlements which will indicate that the instructions are applicable to CLS deals alone For the FS module the system will perform the following validations 7 12 ORACLE Counterparty Type The counterparty is of the CIF type Counterparty The counterparty is a specific customer who is identified as a CLS Participant in the Customer Information Maintenance screen You cannot select the counterparty ALL in this case Currency The currency is a specific currency which is eligible to participate in CLS deals this is defined in the Currency Definition screen In addition the currency should be allowed for the counterparty and the CLS participant branch The CLS Currency Restrictions maintained for the customer will be used to verify the same Product Code If you have selected a specific product it should necessarily be an FX product
90. Product Category Foreign Exchange Spot Product You need to specify the FX Spot Product for internal swap transactions Foreign Exchange Spot Product Description Enter a small description for the Foreign Exchange Spot Product Foreign Exchange Forward Product You need to specify the FX Forward Product for internal swap transactions Foreign Exchange Forward Product Description Enter a small description for the Foreign Exchange Forward Product Foreign Exchange Forward Interest Product You need to specify the FX Forward Interest Product for internal swap transactions Foreign Exchange Forward Interest Product Description Enter a small description for the Foreign Exchange Forward Interest Product Money Market Borrow Product You need to specify the MM product for Borrowing for internal swap transactions Money Market Borrow Product Description Enter a small description for the Money Market Borrow Product Money Market Placement Product You need to specify the MM Placement product for internal swap transactions Money Market Placement Product Description Enter a small description for the Money Market Placement Product 4 3 3 1 Validations for Product Category Details for Internal Swap Transactions e The Product category should be unique across all categories and Oracle FLEXCUBE products we ORACLE No modification should be allowed except closure once a product category has been authorized The MM Products should have auto liqu
91. REVLOSS Credit EXCHANGE LOSS REVLOSS Debit EXCHANGE PROFIT REVPROFIT Credit 10 7 ORACLE Accounting Role Amount Tag Dr Cr Indicator UNRLZ FWD PNL REVPROFIT Debit Accounting Entries for Straight Line Revaluation Accounting Role Amount Tag Dr Cr Indicator PRE_DIS EXPENSE AMORTEXP Debit EXCHANGE LOSS AMORTEXP Credit PRE_DIS INCOME AMORTINC Credit EXCHANGE PROFIT AMORTINC Debit EXCHANGE LOSS REVLOSS Debit UNRLZ FWD PNL REVLOSS Credit EXCHANGE LOSS UNAMORTEXP Credit UNRLZ FWD PNL UNAMORTEXP Debit EXCHANGE PROFIT REVPROFIT Credit UNRLZ FWD PNL REVPROFIT Debit EXCHANGE PROFIT UNAMORTINC Debit UNRLZ FWD PNL UNAMORTINC Credit Advices No Advices allowed for this event 10 5 1 7 Accounting Entries RRVL Deal level Revaluation Reversal For Spot and Forward Contracts with NPV Rebate method of Revaluation Accounting Role Type Amount Tag Debit Credit Indicator EXCHANGE PROFIT Exchange Income REVPROFIT Debit Profit Revaluation Profit UNRLZ FWD P amp L Unrealized Asset REVPROFIT Credit Fwd P amp L Liability Revaluation Profit EXCHANGE PROFIT Exchange Income REVPROFIT_PY Debit Profit Revaluation Profit Previous Year 10 8 ORACLE Exchange Loss Accounting Role Type Amount Tag
92. S Status Information for Alleged Trades 1c cccssescsesesssesecneesecnseeeeuseeeeesecseesecaaeeeenaeeaeaees 8 5 8 1 4 Bulk Authorization of CLS Statuses ccccecceccssssscesssssesecssesecnsessesseescesecssesecseeecseeeeeecsaseeesaeeaeesesneeeaees 8 9 8 1 5 Viewing the Net CLS Currency POSitions cccsccesccesecsseesecese cess cneeaceeaceeseeeeeeeeeeseeeeeceaeenaeenaeenaeenes 8 10 8 1 6 Pay in and Pay out with the Settlement Member ccccccccccceesceesceeceseeeseeaseeseeeseeeseeeseeeseeseeeeneenensees 8 11 8 1 7 Reconciliation of the deal with the Settlement Member ccccsccesccescsseeseeneeeneeeeeeeeeeeeeeeeensseneeeaees 8 12 9 FX ADVICES AND MESSAGES eesssseseseeecserosoesesesoecerosoeseceroroesesesceoesosoesesesoeeosoroeseseeoeeerosoeseeecoesosorsesesseseeese 9 1 9 1 INTRODUCTION esi rre r E E EEE EE E OE O OEE O E EEE 9 1 O VICES E E E A A E E E E E E T 9 1 9 2 1 FX Deal Confirmation Message sccscccccccccessceeccesscessceseceseceseccecaeeeseeseeeeeseseeeaeeeeeeeeseeeeeaeeesesnaeseaeseaeees 9 2 9 2 2 Contract deal Siperiis eeoa ao wht eats E eae E S EE EE aE S E ae aae deaa Era eaa Seni aaen 9 3 9 2 3 Contract brokerage Gdvice s cssci cece leith iinitan aaea eie a N aeaea AE eels 9 4 9 2 4 FX Swap Confirmation Advice cccccsccscsssccsssscsseesessecscesscseeesesseesessecasesecsceeecsaeaceeecsaeenesaeeaeeeesaneaees 9 4 9 2 5 Contract amendment GAVICE sarsies aa est wesascbepias Ge aN 9 5 9 2 6 R ll oyer advice iranesiasiii
93. System considers this field as financial amendment once amendment is done to this field Pre settlement Risk Credit Line Select the credit line that should be used for netted pre settlement limit tracking from the option list provided The list will display all valid credit lines for the counterparty Oracle FLEXCUBE will ensure that credit lines maintained for the customer are not same The system will support all maintenance actions like New Unlock Copy Delete Re open and Close for this function Note the following e All limit tracking options will be checked by default e Credit lines will be enabled only when the limit tracking option will be enabled e Credit line input is mandatory when the limit tracking options are enabled e During copy action all the fields except credit lines will be copied to the new counterparty oo ORACLE 3 5 4 Specifying UDF Values You can associate values to all the User Defined fields created and attached to the Foreign Exchange Risk Netting Agreement screen You can view the list of User Defined fields associated to this screen by clicking Fields button in the Foreign Exchange Netting Limits Maintenance screen User Defined Fields User Defined Fields D Field Name nl x You can enter the value for the UDFs listed here in the Value column For more details on how to create user Defined fields refer chapter Creating custom fields in Oracle FLEXCUBE
94. T NETTING REPORT 0c cccesssececsescecesseececeesaeeecseceecessaeeecsesaececseeeeceesaeeecsesaeeecseeeeeeeseeeenesaess 12 29 12 241 Contents of the Repoftt ccsccesccsscsseesseesseeseesseeeseesecesecusecaecaecaaecaaeesaessaeeaeeseeeeeaeseeeaseeseeeeeeeeeaes 12 29 12 25 PROCESS EXCEPTION REPORT c cccssssececssscecesssececeessececsuseeesssaeeecsesaececsceecesaeeecsesaeeeceneaeceeseseenenaess 12 30 12 25 1 Contents of the Repoftt ccscccsccsscsseeseesseeseesseeeseescceseceaecaecuaecasecaaeesaeeaaeeaeeeeeeseseseeeasenseeeeeneeeaes 12 30 ORACLE 1 About this Manual 1 1 Introduction This manual is designed to help you quickly get acquainted with the Foreign Exchange Module of Oracle FLEXCUBE It provides an overview to the module and takes you through the various steps involved in processing an FX deal entered in your dealing room system You can further obtain information specific to a particular field by placing the cursor on the relevant field and striking lt F1 gt on the keyboard 1 1 1 Audience This manual is intended for the following User User Roles Role Function Back office clerk Input functions for contracts Back office managers officers Authorization functions Product Managers Product definition and authorization End of day operators Processing during end of day beginning of day Financial Controller Product Managers Generation of reports 1 1 2 Organization
95. TING ENTRIES AND ADVICES cccccccccecececececscecececececececececececececeeeeeeeceeeeeeeceeeeeeeeess 10 3 10 5 1 BOOK Booking an FX CONtKrACtAAw cecesceeeeeseeesceescesecusecnsecasecaecaecasecaseeseeeseesseeesesseeseeeeeceaecnaeeaeenes 10 4 11 GLOSSARY ss ssssissssacsassscussesdivassanssntesissceassnnscsssesseesessssasseussaussensaesseseseses seasdesscesdasedsesoassoussoasousasesssoessdeaoesesee 11 1 TTT TMPORTANE TERMS canens Seateves antl alot E beatin beeen E tare Seed ane iee ee ene 11 1 12 REPORTS isiscsssinsincscoadsnsssonssassscucsaseasassesauvscvatunseuessusssgecsasinascusdsnsssnsssessesseessusesunsusseueosouseues sassegsesacseaceessoutses 12 1 12 1 INTRODUCTION cecinere aeeoea raees Eear EEEE dave cea tsteiaas lt aatestaeseatshl aces ce EE R EE EAEE aD RE 12 1 12 2 CURRENCY FORWARD RATES REPORT scceesescecessecececsaececeececeesaeeecseneececseneeceesueeecsesaeescseeseceesreeenenes 12 2 12 2 1 Contents of the Currency Forward Rates Report ssceceeeeeeeeeeesiseeerererrsrersrrrreresrerrrereseererrreee 12 2 12 3 FX CURRENCY ANALYSIS REPORT cccssssccecsesceceeseeeceesaeeececeeceesuececsenaecesseeeececsueeeesesaeesenneaeensseeeeeeaes 12 3 12 3 1 Contents of the FX Currency Analysis R POrt ccccccccesscesscesecesecesecuseeaseesceeeceeeeeeeeeeeceaeeeasenaseneeaes 12 4 12 4 FX MATURITY ANALYSIS REPORT cccesssccessesceceesececsesaececsenaececsaececsenaececseaeecsesaeeecsesaeessneesecesseseeeeges 12 4 12 4
96. X Contract screen The Advices screen will be displayed Contract Advices Contract Reference Number Contract Advices Oo Advice Name Receiver Medium Suppress Priority ok Cancel You can change the following information regarding the advices generated for a contract e The priority and e Whether the generation of the advice should be suppressed 6 5 1 6 5 2 Suppressing the generation of an advice By default all the advices that have been defined for a product will be generated for a contract However you can suppress the generation of an advice for a contract by specifying so in this screen Select Yes if the advice has to be suppressed Indicating the priority of an advice All advices will be sent on a Normal priority You can change the priority of an advice to Urgent through the Advices screen In the Priority column in this screen select Urgent if the advice has to be sent on an Urgent basis After you have made the changes click on Yes button to save the changes Click on No button to reject the changes you have made In either case you will be taken back to the screen from where you invoked this screen vey ORACLE 6 6 6 7 6 8 6 8 1 Brokerage details Click on the Brokerage icon to view the Brokerage details for the contract Please refer to the Brokerage User Manual for details Settlement Details Click on the Settlements icon to view the Settlement detai
97. ails Broker All Single Broker From Date 5 To Date i C include Liquidated Contracts Brokerage on liquidated contracts will be included if you specify it in the Report Options screen Report For In this field you can specify the brokers whose brokerage details are to be reported If you select e All Brokers The brokerage details of all the brokers will be reported e Selected Brokers The brokerage details of only those broker s that you select in the next field will be included in the report ee ORACLE Brokers A list of broker codes of all the brokers in the branch is displayed here If you have chosen the Selected Brokers option in the previous field you can select the brokers that you want to include in the report The brokerage details of all the selected brokers will be reported To remove a broker from this list uncheck the corresponding checkbox Include Liquidated Contracts In this field you can specify whether details of contracts that have already been liquidated should be included in the report To include liquidated contracts in the report click in the square box against the Include Liquidated Contracts field If you do not click in the square box contracts that were liquidated during the specified period will not be included in the report From Date Enter the date indicating the beginning of the period for which the report is to be generated For the selected broker s the broke
98. all profit and loss entries that have been accrued but not collected or paid from FX deals results in Accrual Position For the GL s for which accrual position is not allowed system will include the accrual entries in Cash Position sor System will calculate the accrual position separately for the GL s for which the option Report as Accrual is checked Refer to the chapter Setting up the chart of Accounts for further details i ORACLE For information purpose system will also calculate and display the Open Position Cash Position Spot Position Forward Position and Global Position Cash position Spot Position Forward Position Accrual Position for all the currencies 6 13 1 Viewing the details of the individual deals that contribute to the position In the Currency Position Details screen you can double click on each cash spot and forward positions to view the details of the individual FX deals that have contributed to the position The details of the individual deals that will be available include Reference number of the contract Short name of the customer Debit or Credit indicator Amount Value Date Exchange Rate Against Currency In the Currency Position Details screen double click in the Cash Position field Cash Position Details screen is displayed with the details of the deals that have contributed to cash position Currency Change Position Branch Currency
99. ance field e If the Exchange Rate Variance is between the Minimum in other words Normal and the Maximum Exchange Rate Variance that you have defined the system will display an override message e The system will not store a deal if the Exchange Rate Variance is more than the Maximum Exchange Rate Variance defined for the product Input Mode Specify the mode through which product can be used to book contracts The options available are e Input Only Product can be used only from front end Oracle FLEXCUBE e Upload Only Product can be used during upload of FX contract only e Input and Upload Product can be used both in case of Manual input through Oracle FLEXCUBE as well as through upload Tenor Type Select the tenor for calculation of risk weighted amount It can be either Fixed or Rolling The tenor of FX contract will be arrived as follows e Fixed Bought value date booking date e Rolling Bought value date Branch date Method If you have opted to revalue the foreign currency liability for a product you must also specify the revaluation method by which the profit or loss is to be calculated You can revalue the profit or loss in three different ways They are e NPV Net Present Value e Rebate e Straight Line e Discounted Straight Line For discounted products you can also choose the revalue profit or loss through the Discounted Straight Line method Each of these methods is explaine
100. ange rate is calculated This date will be the settlement days which are maintained for the settlement currency before the maturity date of NDF Forward Contract This field is applicable only for the NDF Forward Contract Settlement Currency Specify the settlement currency other than the NDF currency involved in the deal ne ORACLE Settlement Amount Indicate the net settlement amount of the NDF Forward Contract The net settlement amount is the difference between the settlement currency amount of the NDF Forward Contract and the NDF Fixing Contract The value of this field is computed after booking the NDF Fixing Contract 6 2 4 2 Processing an NDF Forward Deal An NDF deal is booked as FX Forward Contract with all the NDF details maintained in it The product for the NDF Forward Contract is Forward type with the NDF indicator is set to True When an NDF Forward Contract is booked an advice NDF_Conf_Advice is generated through mail to inform the counterparty about the booking When an NDF Fixing Contract is booked against the NDF Forward Contract the fixing status of the NDF Forward Contract is marked as Fixed In case of the NDF Forward Deal the settlement amount tags SETBOTAMT and SETSOLDAMT is replaced by NDF_PROFIT and NDF_LOSS respectively The following are the new events for the NDF Forward Contract e _FIXG Fixing It is processed for the NDF Forward Contract when the NDF Fixing Contract is booked again
101. ange the default brokerage values z ORACLE 2 1 4 Defining Tax Just as you can maintain brokerage details you can define tax details in Oracle FLEXCUBE Tax is calculated according to the Tax Rules that you maintain A tax rule is built with the logic required to calculate tax You can define the logic of tax rules to suit your requirement For each tax rule you can define the following The tax currency e The minimum tax amount e The maximum tax amount e The floor amount e The floor charge e The ceiling amount e If you would like to apply a rate or a flat amount e The basis amount and so on Upto six tax rules can constitute a tax scheme When a tax scheme is linked to a product tax will be calculated for deals involving the product according to the tax scheme Oracle FLEXCUBE s flexible architecture allows you to waive the tax that is applied by default on a deal Tracking Limits As part of the customer information maintenance in Oracle FLEXCUBE you can define liability details for all your customers You can define a hierarchy for tracking exposure a customer company its parent company etc For an FX deal you can track clean and aggregate risks Settling FX Contracts The seamless interface with the Settlements module of Oracle FLEXCUBE allows you to settle the foreign exchange deals processed in Oracle FLEXCUBE through a funds transfer The Settlement Instructions for a foreign exchange deal ca
102. annexure provided at the end of this chapter 7 22 ORACLE 8 1 8 Annexure 1 Workflow for CLS Deal Settlement CLS Deal Settlement The following annexure provides the possible media and messages that may be used in the settlement of CLS deals between the Third Party Oracle FLEXCUBE branch and the Settlement Member The settlement will involve the following e CLS Status Processing e Pay in and Pay out with the Settlement Member e CLS Nostro Reconciliation e Deal Settlement Reconciliation 8 1 1 CLS Status Processing You can obtain the status of a CLS deal from the following media 8 1 1 1 Web Based Deal Status The Settlement Member will update the CLS deal status on the web The CLS deal status information will be obtained from the web via the CLS Interface updated in the CLS Status browser 8 1 1 2 Incoming SWIFT CLS Deal Status Confirmation The various SWIFT messages that can be received by the Third Party will include e MT300 FX Confirmation This message may be used to communicate all CLS Statuses other than Failed e MT392 Request for Cancellation This will only be used to indicate the Rescinded Status of a deal e MT396 Answers Responds to a request for cancellation This will only be used to indicate the Failed status of a deal The CLS deal status will be populated in the Incoming Message Browser depending on the message type received 8 1 1 3 CLS Status Ty
103. arries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body You can find the following details in the body of the report Contract Reference No The contract on which an override was given Event Code The identification code of the event Error Code The error code of the error message Error Mesg The description of the error message Maturity Date The maturity date of the contract Deal Currency The S W I F T Code of the deal currency i ORACLE Contract Reference No The contract on which an override was given Customer No The identification number of the customer Deal Amount The amount involved in the contract Maker The user id of the person who entered the contract Checker ID The user id of the person who authorized the contract 12 9FX Brokerage Details Report The Brokerage Details report gives details of brokerage that has been processed against contracts The report will be generated for the period and the list of brokers specified by you in the Report Options screen You can invoke this screen by typing FXRPBRDT in the field at the top right corner of the Application tool bar and clicking the adjoining arrow button E Foreign Exchange Brokerage Details Report Options Webpage Dialog Foreign Exchange Brokerage Det
104. at you enter here would be different from the Standard Exchange Rate it is referred to as a Exchange Rate Variance You cannot enter a rate that exceeds the Maximum Exchange Rate Variance that you have defined for the product in the Product Preferences screen oe ORACLE If the variance is less than the Normal Exchange Rate Variance defined for the product the contract will be stored without an override If the variance is greater than the Normal Exchange Rate Variance and less than the Maximum Exchange Rate Variance you will be prompted for an override The contract will be stored only if you provide an override If the variance is greater than the Maximum Exchange Rate Variance With Override the contract will not be stored You have to change the Exchange Rate before storing the contract Rollover Spot Rate For contracts involving local currency the Spot Rate of the foreign currency is taken as the default Spot Rate For cross currency contracts the rate between the two currencies as maintained in the Currency table is taken as the default Spot Rate If the rate between the two currencies has NOT been maintained the Spot Rate of the P amp L Currency against the local currency is taken as the default Spot Rate You can change the Spot Rate displayed in this field Rollover Date This is the date on which the contract is to be rolled over Spot Date For contracts involving the local currency the Spot Date of the
105. ate e Sold Amount e Sold Currency e Sold Value Date e Option Date e Profit and Loss Currency e Broker e Booking Date e Related Reference Number acd ORACLE e Deal Rate e External SWAP Reference e Branch 6 13 Online Querying for FX positions Your bank would have entered into numerous FX deals involving different currency combinations During the day or end of day you may want to view the FX positions for different currencies Oracle FLEXCUBE allows you to view the currency positions through the online query feature In the Application Browser click on Query and select the option Currency Query to invoke the Currency Position Details screen Currency Position Details Branch Code Currencies Current Position Currency Cash Position Spot Position Forward Position Open Position Accrual Position Global Position In this screen system calculates and displays the FX positions for different currencies System calculates the FX positions for each currency for a particular day by using the accounting entries posted to different GL s e The sum ofall entries of settled FX transactions contributes to Cash Position e The sum of all entries of FX deals which fall within the spot days of each currency results in Spot Position e The sum of all entries of FX deals settled beyond the spot days for the currencies maintained at your bank contributes to Forward Position e The sum of
106. ation Browser You can also go to the FX Contract Input screen from the following screens e FX Contract summary view e FX Contract detailed view 6 2 1 Invoking the Screen You can invoke the Foreign Exchange Contract Input screen by typing FXDCONON in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Select New icon in the Application toolbar or click new icon The system will display Transaction Branch Code screen Here you can select the transaction branch fe Transaction Branch Code Webpage Z The system defaults the logged in branch by default as the transaction branch Transaction Branch Select the appropriate branch from the list of branches available in the option list os ORACLE While clicking Ok button the system validates the access rights of the selected branch and function for the user If you don t have appropriate rights on the selected branch and function the system will display an error message If you select a valid branch the system updates the same as transaction branch and the transaction will be posted for this branch Foreign Exchange Contract Input Product Code EH Counterparty Dealer Source Product Description Main Rollover Instructions Netting Revaluation Details Buy Sell Buy Sell Bought Currency Bought Amount Bought Value Date Booking Date Deal Rate Broker Customer
107. bought value date Sold Currency Select the sold currency from the option list Product Code Select the product code from the option list Broker Select the broker from the option list Related Reference Number Select the related reference number from the option list External SWAP Reference Select the external SWAP reference number from the option list When you click Search button the records matching the specified search criteria are displayed For each record fetched by the system based on your query criteria the following details are displayed Authorization Status Contract Status Product Code Counterparty Contract Reference Number 6 66 ORACLE e User Reference Number e Buy Sell e Bought Amount Click Advanced Search to display the screen below Advanced Search Operator Value Bought Currency Bought Value Date Broker Query Clesr Query Buy Sell Counterparty Contract Reference Number External SWAP Reference Product Code Related Reference Number Sold Currency Sold Value Date User Reference Number Order By Ascending Clesr Query Authorization Status Contract Status You can query a contract based on any of the following details e Contract Reference Number e User Reference Number e Buy Sell e Bought Amount e Bought Currency e Bought Value D
108. button to view the messages linked to each event Paview Messages WebPage Didlog E Contract Reference Number CHOBHAT001850022 Event Sequence Number 2 Event SGEN m Medium Receiver Name A 7 DEBIT_ADVICE CHO001 066 T PAYMENT_MESSAGICHO001 066 Zi Message Click on Accounting Entries button to view the accounting entries for the event oe ORACLE Reference Number CHOBHATO01850022 Accounting Entries E iew Details Web Page Dialog xi Bi Event SGEN 4 o Branch Account DriCr Amount Tag Currency Foreign Currency Amount Rate Local Currency Date Value Date oA JF See Position Entries Overrides mi Overrides Authorization Status Auth By O For Bought CCY Value Date the Message Date is over F TO No limit tracking done for the contract T MIS Defaults picked for CHOBHATO01850022 C ICCF Defaults picked for CHOBHATOO1850022 IP Tax Defaults picked for CHOBHATO01850022 T Settlement Defaults picked for CHOBHATOO1 850022 Auth Date Stamp z le The following details will be provided for each Booking Date Account Value Date Currency Amount Dr Cr indicator Transaction Code entry 6 39 ORACLE 6 5 Suppressing or Prioritizing Advices The advices that have to be generated for the various events of a contract should be defined for each product This will be applicable to all contracts involving the product Click on Advices button in the F
109. c I Cancel Authorized By Date Time E open The discount rates that you maintain are for a Currency and Rate Type combination After you select this combination you can proceed to set up tenors and the rates applicable to each tenor Currency Select the Currency from the option list available Base Date The discounting rates that you maintain subsequently will apply to FX contracts from the base date that is displayed here ais ORACLE The current system date will be displayed in this field You can change the default value However you can only enter a date that is the same as or later than the current system date Rate Type The discount rates that you maintain are for a Currency Rate Type combination Select the rate type for which you are defining discounts Period Code You can maintain discounting rates for the Currency Rate Type combination for specific tenors in days These tenors are referred to as Periods in Oracle FLEXCUBE A Period commences on the Base Date applicable to the Currency and Rate Code that you selected and ends on the date that is displayed in the Actual Date field For contracts involving currencies for which you have not maintained discount rates the rates of the discount currency specified in the Bank Parameters will be used You must specify the discounting rate for a period before you enter the next period Discounting rate The discounting rates for different periods for a Cu
110. c events User initiated events are events that you initiate manually Examples of such events are reversal of contracts manual liquidation of contracts manual roll over of contracts and so on Automatic events are events that are executed automatically during the end of day or beginning of day process Examples of such events are auto roll over auto liquidation contract confirmation and so on Advices The following are the advices that you can generate in the foreign exchange module e FX Payment message and Receive Notice e FX Contract confirmation advice Dealing room telex e FX Contract confirmation tracer advice e FX Contract deal slip e FX Contract Brokerage advice e FX Swap confirmation advice e FX Contract Amendment advice e FX Contract Roll over advice e FX Contract Reversal advice e FX Brokerage Amendment advice e FX Brokerage Reversal e FX Confirmation advice e FX Payment message e FX Receive Notice e REVSWIFT Please note that all advices that provide In currency details will also provide the equivalent Euro values a ORACLE 9 2 1 FX Deal Confirmation message To confirm the details of a foreign exchange contract you enter into with a customer you can generate a confirmation message that can be transmitted over SWIFT in case the counterparty is a bank or Telex or Mail SWIFT format MT300 The message contains the following information e Contract reference number e Event Serial N
111. ces FJ Continuous Linked Settlement Participant Settlement Member Eq Description O T Copy O Auto Confirm Continuous Linked Settlements Deals Date Time Checker Date Time O Revaluation At Product O User Reference Number in Messages Record Status Authorization Statu Cancel iI You can capture the following details relating to Foreign Exchange Branch Parameters Maintenance Branch Code Select the code of the branch for which you are setting up the parameters Branch Description The description of the selected branch code is displayed here 3 2 1 1 Setting Revaluation Parameters If a scheduled revaluation date for a foreign exchange contract falls on a holiday the process of revaluation can be shifted according to either of two options that you specify System Date Selecting this option will cause the revaluation process to be triggered as part of the BOD process on the next working day after the holiday se ORACLE Next Working Day 1 If you select this option the revaluation process is triggered as part of the EOD batch process on the working day immediately previous to the holiday on which the revaluation schedule falls Example A foreign exchange forward contract has a revaluation schedule falling on 13 September 2003 which is a Saturday and a holiday for your branch 14 September Sunday is also a holiday If you select the Reval Till Sy
112. change contracts To invoke the screen type FXRNETMA in the field at the top right corner of the Application tool bar and click the adjoining arrow button gt Foreign Netting Agreement Report From Record Customer Number To Record Customer Number 12 20 1 Contents of the Report The contents of FX netting agreement report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body You can find the following details in the body of the report wee ORACLE Customer No The identification number of the customer Netting Type The netting type used for the agreement Currency The S W I F T Code of the deal currency Days The number days Std Pay The standard payment details Details Outgoing Bank The name of the outgoing bank Outgoing Cust The name of the outgoing customer 12 21 Brokerage Confirmation Journal Brokerage Confirmation Journal provides information on the amount deal currency and the broker code of contracts To invoke the screen type FXRPBRCO in the field at the top right corner of the Application tool bar and click the adjoining arrow button Foreign Exchange Broker Confirmation Report Options Foreign Exchange Broker Confirmation R
113. ciary is a customer of your bank you can specify an appropriate FT product that you have maintained in your bank Auto Authorize Netted Fund Transfer You can specify whether the netted FT should be automatically authorized for certain selected counterparties against the transaction settled on a particular day Netted payment contract will be uploaded as an authorized contract if it is checked Otherwise the contract will be uploaded as unauthorized In such a case you have to manually change the details of the contract if required and on authorization the payment message will be generated Only details pertaining to settlement accounts will be allowed to be modified Contract details pertaining to counterparty or amounts cannot be modified Netting Days Basis You can specify whether Netting date should be based on netting days maintained for the Currency or the netting days maintained in the Netting Agreement for the customer You have to choose between e Currency If you opt for currency as the basis for netting days netting days will be defaulted from the FX netting days of currency maintenance considering the specific currency and the leg being netted e Netting Agreement If you opt to relate the netting days to the Netting Agreement the netting date will be calculated taking into consideration netting days maintained in the netting agreement for the customer irrespective of the leg being netted oat ORACLE Standard Payment
114. cordance with their instructions This chapter explains the maintenances required in Oracle FLEXCUBE to support the CLS scheme as a third party participant and the processing involved in the settlement of such FX transactions In order to support CLS as a third party participant you must e Maintain the CLS preferences for your branch e Allow your customers to settle their deals via the CLS bank e Maintain currency restrictions for customers to participate in CLS trades e Maintain currency preferences for your branch exclusively for CLS e Setup the calendar of holidays for the CLS bank e Identify the financial institutions participating in CLS and the type of link with the CLS bank whether direct or indirect e Specify the settlement instructions for CLS deals e Maintain an alert group for a specific CLS status The above maintenances and the processing involved in the CLS settlement of Foreign Exchange deals are explained in detail in the following sections of this chapter 7 1 ORACLE 7 1 1 Maintaining CLS Preferences for the Branch You can specify the CLS preferences as part of maintaining the generic processing guidelines for FX deals entered into at your branch You can invoke the Foreign Exchange Branch Parameters Maintenance screen by typing FXDBRMNT in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Foreign Exchange Branch Parameters Maintenance Branch Co
115. ct Amount in LCY and the Spot Equivalent in LCY is the Premium or Discount Amount If the cross currency rate has NOT been maintained the Spot Rate of the P amp L Currency is applied on the contract amount to calculate the amount in terms of the P amp L Currency The local currency equivalent of this amount is calculated as the Spot Equivalent in LCY The difference between the Contract Amount in LCY and the Spot Equivalent in LCY is the Premium or Discount Amount Interest Rate Bought Leg This is the Interest rate applicable to the Bought leg of the contract Interest Rate Sold Leg This is the Interest rate applicable to the Sold leg of the contract ea ORACLE Discount Bought Leg Specify the notional interest that you will earn on the bought currency interest receivable when a forward deal is settled On the booking date the buy deal amount is reduced by the discount amount and contingent entries are passed for the discounted bought amount Accrual entries are passed for the discount amount till the maturity date depending on the accrual frequency You can specify the Discount Bot Leg and Discount Sold Leg only if the product involved in the deal is associated with the Discounted Straight Line method of revaluation Sold Leg Specify the notional interest that you will earn on the sold currency interest payable when a forward deal is settled On the booking date the sell deal amount is reduced by th
116. ction and the same will be displayed in this field Spot Deal Exchange Rate You need to specify the exchange rate for the Spot FX transaction If the amounts are specified then the system will calculate the exchange rate ae ORACLE Spot Value Date This indicates the settlement date for the spot FX transaction and the value date for the MM borrow and placement transactions The Application Date appears in this field by default and cannot be changed Forward Deal Exchange Rate You need to specify the exchange rate for the forward FX transactions Forward Value Date You need to specify the date This will be used as the settlement date for the Forward transactions and the maturity date for borrowing and placement transactions The screen will also display the individual transactions created in detail blocks upon authorization of the internal swap input transaction Three FX transactions created will be created within a single block and two MM transactions will be created in the other The information displayed for the FX transactions will be as follows e FX Contract Reference Number e Product Code e Bought Currency e Bought Amount e Sold Currency e Sold Amount e Value Date e Exchange Rate On double clicking a row the individual FX transaction will be displayed The information displayed for the MM transactions will be as follows e MM Contract Reference Number e Product Code e Currency e Amount e Value Date e Maturity
117. d below with an example ane ORACLE Rebate Non NPV method This method of revaluation is also referred to as the Marking To method You enter the following forward deal INR is the local currency Trade Date 1 1 08 Maturity Date 15 2 08 Bought USD 100 000 Sold INR 4 500 000 Deal Rate USD 1 INR 45 00 Spot Rate USD 1 INR 46 00 If the revaluation frequency is monthly then on 31 01 2008 the contract will be revalued with the prevailing forward rate for the unexpired period of the contract Assume that the 14 Days Forward rate maintained in the Forward rates screen is 46 Then the revaluation profit Forward Rate Deal Rate Deal Amount 46 45 100000 100000 The following entries would be passed on 31 1 08 Dr Fwd Adj a c INR 100 000 Cr Exchange P L INR 100 000 Rebate NPV method To revalue foreign exchange contracts using the Rebate NPV method you should maintain the Forward rates and the Discount rates for currencies The method is similar to the Rebate method only the profit loss arrived at will be discounted using the discount rates maintained for the main leg of the transaction Example When the contract used in the first example is revalued using the Rebate NPV method the following would be the account entries and balances Accounting Entries on 1 1 08 Dr Fwd Bought USD Contingent Asset USD 100 000 INR 4 500 000 Cr Fwd Sold INR Contingent Liab INR 4 500 000 Accounting Ent
118. d in this case The net position per currency for all deals settling on a value date will be communicated 8 1 6 2 SWIFT settlement The MT971 Netting Balance Report will be used to arrange for funding the deals The messaging process will upload the details of the message into the Incoming Message Browser 8 1 6 3 Process flow Subsequent to receiving the net position information the following will be initiated manually Verification With the information available in MT971 or from the web service you can check the net long or short position of each currency with e Their Control Account Balances using the CLS Net Positions Browser and e The balances in their CLS NOSTRO accounts 8 11 ORACLE Funding Once the information is verified your branch can arrange for funding the CLS NOSTRO by any of the pre arranged methods Post funding pay in you will receive the corresponding MT910 MT900 Confirmation of Credit Debit from the Settlement Member The message details can then be uploaded in the Incoming Message Browser Posting the Control Account balances On receipt of MT971 Netting Balance Report or at pre determined times you will be required to manually post the entries to the CLS Control Account and CLS NOSTRO This will be required for reconciliation of the CLS NOSTRO Accounts STOP The Nostro Reconciliation module of Oracle FLEXCUBE will be used to reconcile the Customer Statement Message MT940 received from the
119. d like the authorizer to rekey Click on the box adjacent to each contract detail to indicate that it should be rekeyed 4 2 1 3 Allowing an Exchange Rate Variance percentage The standard exchange rate for the currencies involved in a deal will be picked up by default from the currency table during deal processing You can change the standard rate that defaults to a deal during deal processing If the exchange rate is different from the standard rate specified in the currency table it is referred to as an exchange rate variance For a special customer or in special cases you can allow an exchange rate a special rate that is different from the Standard rate maintained in the currency table Normal Exchange Rate Variance In the exchange rate variance field specify the minimum percentage difference of the special rate from the Standard rate In other words you can specify the Minimum Exchange Rate Variance for a product Maximum Exchange Rate Variance In the exchange rate variance field specify the maximum percentage difference of the special rate from the Standard rate In other words you can specify the Maximum Exchange Rate Variance for a product ii ORACLE The implications of defining an exchange rate variance are discussed below e The system will not seek an override if the Exchange Rate Variance is lower than the Minimum or Normal Exchange Rate Variance that you have specified in the Normal Exchange Rate Vari
120. d payments will not be generated automatically by the Contract Reversal function You have to generate them manually After the reversal has been done you will be returned to the Contract Detailed View screen Reversing and Rebooking a Contract To enable amendment of FX Contract details Oracle FLEXCUBE will reverse the old contract and rebook a new contract with the old user reference number and external reference number During reversal the old contract is first reversed and a new contract is booked with Reversed Oracle FLEXCUBE ref as the parent contract While reversing and rebooking the parent contract details including the subsystems will be copied to a new contract and the parent will be reversed and the screen will be in new mode so that any details of the contract can be changed It will be validated that no payment messages have been sent for the Reversed Oracle FLEXCUBE ref no A configurable override will be displayed If the payment messages have been generated then the Cancellation request messages REVSWIFT will be generated The user reference number at the branch parameters maintenance should be checked The user reference number and the external reference number of the parent contract number will be copied to the new contract Deletion of the new contract will delete the reversal of the parent contract and set the value of user reference number and external reference number in the parent contract from the child contract
121. d value should be within a certain range This range is referred to as the Exchange Rate Variance The exchange rate variance is specified while creating a product Example The default exchange rate that is maintained in the currency table for the currency pair is 2 The Minimum and Maximum Exchange Rate Variance that you have defined for the product are 1 1 and 2 0 respectively If you change the exchange rate for a GBP USD contract By less than 1 1 i e by 0 022 the system will not display an override message Between 1 1 and 2 0 i e between 0 022 and 0 04 the system will display an override message to store the contract Beyond 2 0 i e beyond 0 04 the system will not store the contract that you are entering Limits Tracking Required Check this option to specify that limit tracking for settlement risk pre settlement risk and weighted risk should be done for FX contracts When this option is checked the risk tracking option will also be enabled By default this field will be checked ie ORACLE Track Settlement Risk This option will be enabled only when the Limits Tracking option is checked Check this option to specify that limit tracking should be done on bought amount of FX Contracts Settlement Risk Credit Line Settlement risk is the risk that one party will fail to deliver the terms of a contract with another party at the time of settlement Select the credit line that should be used for netted settlement
122. date of the Bought and Sold legs of FX deals linked to the product can be different If you select Yes you can specify different value dates for the Bought and the Sold legs of the contract during deal processing However deals with the same Value Date can also be entered for the product If you select No the Value Date settlement date should be the same for both legs of the deal Extension Allowed You can choose to allow extension of the Value Date of FX deals involving a product If you disallow the extension of value dates for a product you cannot extend the Value Date of deals involving the product Example The Value Date of a deal is 1 April 08 You would like to extend the Value Date of the deal by two days If you have allowed extension of contracts for the product you can settle the contract on 3 April 08 Local Holiday Check Select Yes option if you want the system to check for local holidays of your bank else select No After you have specified all your preferences in this screen click on Yes button to store them in the system Click on No button if you do not want to store your preferences in the system eo ORACLE 4 3 Product Combinations A swap deal is usually a combination of two foreign exchange contracts These contracts could be Spot Forward or Forward Forward contracts It involves a simultaneous buying and selling of currencies wherein the currencies traded in the first
123. de Description Process Till System Date C Revaluation At Product Next Working C User Reference Number in Day 1 Messages Revaluation Reversal Account Revaluation Deal Level Continuous Linked Settlements Preferences FJ Continuous Linked Settlement Participant Settlement Member Description O T Copy FJ Auto Confirm Continuous Linked Settlements Deals Date Time Record Status Checker Date Time Authorization Statu Cancel s The branch code along with the name of the branch for which the preferences are being maintained will be defaulted to the screen Branch Code Branch Description Process Till Select the date up to which FX deals should be processed in the branch The options are e System Date e Next Working Day 1 Revaluation Reversal Revaluation entries can be reversed in either of two ways according to your specification e Account Revaluation If you select this option revaluation entries passed during the EOD process are reversed as part of the account revaluation process on the next working day You must ensure that the account revaluation process is run before running the contract revaluation process e Deal Level If you opt for deal level revaluation reversal a BOD process reverses the contract revaluation entries posted the previous day Revaluation entries are posted and reversed at the level of individ
124. deal are reversed in the next A swap deal would be defined in Oracle FLEXCUBE as a Product Combination that is involving two different products a particular spot or forward product and another spot or forward product 4 3 1 Maintaining Product Combinations A swap deal is in effect a combination of two foreign exchange contracts These contracts could be e Spot Forward OR e Spot Spot contracts A swap deal will therefore involve two distinct products that you have created The first leg of the deal will involve a particular product And the second leg of the contract will involve a different product Example You have defined a product for spot deals for buying USD with INR called BuyUSD You have created another product for buying INR with USD called BuyINR You enter a swap deal in which in the first leg you buy USD and sell INR and in the next leg you buy INR and sell USD If you do not maintain a product combination you will enter a different contract for each leg of the swap deal For the first leg of the swap you will enter a spot deal to buy USD and sell INR The product involved would be BuyUSD In the second leg of the swap you will enter a spot deal to buy INR and sell USD The second leg of the swap would involve BuyINR 4 3 2 Creating a Product Combination Instead of entering two contracts for the different legs of the contract involving two products you can enter one using a single product This product
125. displayed Contract Rate The exchange rate specified for the contract when it was initiated Revaluation The exchange rate differential specified in the Forward Rates table is Rate applied on the Contract Rate to calculate the Revaluation Rate i ORACLE Contract LCY The local currency equivalent of the contract amount Rebate LCY The rebate amount calculated using the revaluation rate Profit or Loss LOCAL CURRENCY The profit or loss amount which is calculated as Contract LCY Rebate NPV The discounting rate as specified in the Discounting Rates table is applied on the profit or loss amount to arrive at the NPV amount For each currency the net monthly and yearly totals for the following are reported Net FCY Amount the total amount in foreign currency Net Contract LCY the local currency equivalent of the amount Net Rebate LCY the total rebate amount that has been calculated in the local currency Net Profit or Loss the total profit or loss amount Net NPV the total NPV amount 12 14 Netting report by Netting Date and Customer FX to FT This report gives details of netted Foreign Exchange contracts settled through the FT module The report gives the details of netted contracts for a specified customer and date You can generate this report any number of times during the day You can generate this report for A specific date or a date range A specific c
126. dule Specific Tables Maintenance chapter Automatic Liquidation of a Contract You must run the automatic liquidation function to liquidate contracts marked for liquidation at the Beginning of Day The validations When you run the auto liquidation process at the Beginning of Day a contract will be liquidated if e It is marked for auto liquidation e Itis authorized e It has not already been liquidated rolled over or reversed e The Value Date of the contract is less than or equal to the current system date In case a holiday precedes the next working day those contracts that mature on the holiday will also be liquidated That is when you run this function all contracts with a Value Date between today and the next working day will be liquidated However if the holiday spans a month end contracts to be settled on the holiday falling in the next month will be liquidated when you run this process during the Beginning of Day on the first working day after the holiday Example Today s date 14 November 98 Next working date 16 November 98 that is 15 November 98 is a holiday When you run the auto liquidation function on 14 Nov 98 the following contracts will be liquidated e All contracts with a Value Date of 14 November 98 and e All contracts with a Value Date of 15 November 98 However if Today s date 29 December 98 Next working day 2 January 99 that is 30 December 31 December and 01 January
127. dule from which the report has been generated date and time at which the report has been generated and the page number of the report Body You can find the following details in the body of the report Contract The Reference number of the contract Reference No Customer The code of the counterparty involved in the contract Maturity Date The settlement date of the contract Event Code The identification code for the event Event The description about the event Description CCY The S W I F T Code of the deal currency Bought The amount that was involved in the activity that was not performed For Amount example if the liquidation of the contract failed this is the total amount that had to be liquidated if rollover failed this is the amount that had to be rolled over etc Error Code The error code of the error message Message The description about the errror message 12 12 FX Straight Line Contracts Spot Revaluation Report This report gives details of contracts that have been revalued through the Straight Line Revaluation method You have to select the currency and the product through the Report Options screen Report For In this field you can specify the currencies for which the report is to be generated If you select e All Currencies The details of revaluation on contracts involving any currency allowed for the branch will be reported e Selected Currencies The details of revaluation
128. e Foreign Exchange Contract Reassign screen by typing FXDREAS in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button The Contract Reassign User Prior to Authorization screen will be displayed and you can enter the user id of the user to whom you want to assign the contract This user should have access rights to enter FX contracts The following details needs to be entered here Product Enter the product code of the contract you want to assign to another user Contract Reference Number Each contract has a unique Reference Number This number is automatically generated by the system during contract processing Enter the Reference Number of the contract that you want to assign to another user Current User Identification Specify the user id of the current user New User Identification Specify the user id of the new user to whom you want to assign the task Click the option list next to the respective fields to select the required inputs for Product Contract Ref No and New User ID Click on Yes button to save the details you entered Click on No button if you do not want to save the details a ORACLE 6 11 Viewing FX Payment Details You can view the FX payment details in the Foreign Exchange Payment Summary screen To invoke this screen type FXSPMNT in the field at the top right corner of the Application tool bar and click the ad
129. e changed during amendment or any other event 6 2 8 During copy operation the limits tracking options will not be copied from contract These will be defaulted from limits netting agreement During limits processing the credit lines and limits netting type will be picked from the limits netting agreement Manual Netting You can invoke the Manual Netting screen by typing FXDMANNT in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Manual Netting Customer Currency Currency Pair Currency1 Currency2 Sequence Number Perec Ok Cancel To initiate manual netting of FX contracts for a specific customer you have to enter the following details in the Manual Netting screen Customer The adjoining option list displays the customer number of the customer for whom you wish to initiate manual netting Choose the appropriate one You can also choose customers whose contracts are marked for auto netting If you choose to manually net the contact of an auto netting customer an override will be displayed prompting you for confirmation On confirmation you will be allowed to initiate manual netting Currency The adjoining option list displays a list all the currencies in which the specified customer has contracted that requires netting You can choose the currency which has to be manually netted Alternatively you may choo
130. e JPY GBP contract e One AUD CHF contract When you run the netting process the system selects only the USD INR contracts that are linked to Cavillieri and Barrett Finance Corporation as they are the contracts with the same currency pair The selected contracts will then be netted This type of netting is referred to as Pair wise Netting Pair wise netting is done only between contracts having the same value date Example Consider the following contracts Contract 1 Bought USD 3 million Value Date 15 4 Sold BHD 1 million Value Date 15 4 Contract 2 Bought USD 6 million Value Date 15 4 Sold BHD 2 million Value Date 17 4 Contract 3 Sold USD 3 million Value Date 15 4 Bought BHD 1 million Value Date 17 4 When you run the netting process at the beginning of day on 17 4 contracts two and three will be netted Contract one will not be netted as the BHD settlement is on a different date 15 4 The netted amounts in this case will be as follows USD inflow 3 million Value Date 15 4 BHD outflow 1 million Value Date 17 4 In case the value date of both legs of another USD BHD contract is due on 15 4 for the same counterparty contract 1 will be netted with it e Currency wise Netting You can opt to net contracts currency wise When you run the Netting Process the system selects all contracts that have been specified for Currency wise Netting coun
131. e amount in terms of the P amp L Currency The local currency equivalent of this amount is calculated as the Spot Equivalent in LCY The difference between the Contract Amount in LCY and the Spot Equivalent in LCY is the Premium or Discount Amount If the cross currency rate has NOT been maintained the Spot Rate of the P amp L Currency is applied on the contract amount to calculate the amount in terms of the P amp L Currency The local currency equivalent of this amount is calculated as the Spot Equivalent in LCY The difference between the Contract Amount in LCY and the Spot Equivalent in LCY is the Premium or Discount Amount Authorizing FX Payment Details After entering the deal details click Save icon to save the details The system updates this as an unauthorized contract You can authorize a payment by clicking the Authorize icon on the Application toolbar You cannot authorise a contract from the Foreign Exchange Payment Input screen in the following cases e the contract has multilevel of authorization pending the same will be done using the Multilevel Authorization Detailed screen e the level of authorization is greater than or equal to N e the Nth or the final level of the users authorisation limit is less than the difference between amount financed and sum of the limits of all the users involved in authorizing a transaction this case holds good when the Cumulative field is checked
132. e discount amount and contingent entries are passed for the discounted sold amount and accruals are booked for the discount amount If it is an LCY FCY deal the discounted deal amount of the LCY leg is taken as the Lcy Equivalent of the contract For an FCY FCY deal the local currency equivalent of the discounted deal amount of the non deal currency calculated at the prevailing exchange rate is taken as the Lcy equivalent of the contract Based on the deal type the Lcy equivalent of the contract is determined and displayed in the Discounted Amount in Lcy field Discounted Deal Amount Bought Leg This is populated only in case of Discounted Straight Line method of Revaluation This is just a display field This will be the result of Bought Amount Revalued Discount amount for Bought Leg Discounted Deal Amount Sold Leg This is populated only in case of Discounted Straight Line method of Revaluation This is just a display field This will be the result of Sold Amount Revalued Discount amount for Sold Leg Spot Local Currency Equivalent When the contract is revalued this information will be used Discounted Amount in Local Currency For an LCY FCY deal the discounted amount of the LCY leg is displayed in this field oe ORACLE For an FCY FCY deal the local currency equivalent of the discounted amount of the non deal currency calculated at the prevailing exchange rate is displayed sor Partial payme
133. e event date e The amount for the event e The value date for the event e The settlement account Mail messages Mail messages contain the following information e The contract reference number e The payment currency e The counterparty e The address of the counterparty e The contract amount e The event date e The amount for the event e The value date for the event e The settlement account 9 3 2 Generating Receive Messages Receive messages are generated by the messaging sub system when you receive payments from a counterparty You can configure receive messages to suit the medium of communication Receive messages can either be for the SWIFT or TELEX mediums SWIFT messages You can generate SWIFT receive messages in the MT 210 format A SWIFT message provides the following information to the counterparty e The contract reference number e The value date currency code and the amount e The counterparty e Remarks a ORACLE Telex messages Telex messages contain the following information The contract reference number The product description The currency The counterparty The contract amount The direction of funds The event code The event date The amount for the event The value date for the event The settlement account Mail messages Mail messages contain the following information The contract reference number The payment currency The counterparty The address of the counterparty The contract amount
134. e parent will be nullified and the external swap reference number will be copied to the child contract Both the legs of the swap contract will have the same reference no The SWAP reference number will be only for information and no processing will be done based on this in Oracle FLEXCUBE on ORACLE The External SWAP ref no can be viewed in the Foreign Exchange Contract Summary screen You can invoke the Foreign Exchange Contract Summary screen by typing FXSCONON in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Foreign Exchange Contract Summary x ra m Bought Currency Bought Value Date x 1 Broker laz Buy Sell E Counterparty a3 Contract Reference Number External SWAP Reference az Product Code J Related Reference Number az Sold Currency iH Sold Value Date User Reference Number GH Authorization Status bd Contract Status by Search Advanced Search Reset I Export Records per page 15 xij ciei of 1 l cl Go to Page j Bought Currency Bought Value Date Broker Buy Sell Counterparty Contract Reference Number External SWAP Reference Product Code lv Buy Sell Authorization Status Contract Status B Buy A Authorized 4 Active S Sell U Unauthorised Y Yet to be Initiated L Liquidated R Reversed H Hold 6 2 4 5 FX Limits processing The various Limits defined for FX con
135. ed The system liquidates both matched and unmatched CLS deals on the value date 7 2 3 1 Processing uploaded deals In the case of uploaded contracts if the first level check fails the deal will get uploaded as a Non CLS deal If the second and third level checks fail the upload also fails and an error message will be displayed to notify the same Upload of CLS deals will happen successfully if all the three levels of checks are satisfied 7 2 4 Message Generation for CLS deals If you have maintained multiple FX Confirmation Message types for the SWIFT Media across different locations for a customer in the Customer Address Detailed screen the T Copy will be sent to the Primary Address of the counterparty However this option is available only for the message type FX_CONFIRMN Refer the chapter titled Maintaining Addresses for a Customer in the Messaging Systems User Manual for more details 7 21 ORACLE 7 2 4 1 Generation of the FS Confirmation Message for CLS deals MT304 The MT 304 will be generated automatically upon authorization of an FX deal if the following conditions are satisfied e The deal is CLS Eligible and the Exclude From CLS option is not checked for the deal e You have not maintained the SWIFT primary address for the counterparty with message type as FX CONFIRMN OR e The T Copy Required option is not selected at the branch level If the above conditio
136. ed For cross currency contracts the amount in the P amp L Currency is displayed Coniract Rate The exchange rate specified for the contract when it was initiated Spot The spot rate that was used during revaluation Revaluation Rate Coniract LCY The local currency equivalent of the contract amount Rebate LCY The rebate amount in LCY calculated using the spot revaluation rate Profit or Loss The profit or loss amount that resulted during revaluation The following totals are given e Total FCY Amount e Total LCY Amount e Total Rebate Amount LCY Total Profit or Loss Amount 12 13 FX Straight line Contracts Accrual Report This report gives details of the Premium or Discount Amount that has been accrued on contracts revalued through the Straight Line Revaluation method The details of the amount accrued so far and the amount accrued during the last revaluation are given in the report You have to specify whether the accrual is actual or memo in the Report Options screen Report For In this field you can specify whether you want report details of Memo Accruals or Regular Accruals e Actual Accrual All interest accruals that have been performed on the last accrual run are reported e Memo Accrual Interest accrual figures for all contracts as of the last memo accrual will be reported In this case the interest accrual is performed on all active contracts but accounting entries are not pas
137. ed The details that have been entered for the contract except the Reference Number the User Reference Transaction Date Value Date and the amounts will be copied 6 8 10 Multilevel Authorization of a Contract 6 8 11 High value transactions may require multilevel of authorization The levels of authorizations are defined in the Product Transaction Limits screen You can use the Multilevel Authorization Detailed screen for authoring a contract n 1 times However final authorization can take place only in the contract screen For more details refer the Multilevel Authorization of Contract Loan Account section in the Procedures User Manual Authorizing a Contract All operations on a deal input modification reversal manual liquidation or manual roll over have to be authorized by a user other than the one who performed the operation This user should have the requisite access rights All deals should be authorized before you can begin end of day operations You can invoke the Contract Authorization screen by selecting Authorize icon from one of the following screens e Contract Summary View e Contract Detailed View From Contract Summary View select the Authorize option when the contract is highlighted From the Contract Detailed View screen choose Authorize when the details of the contract are being displayed one ORACLE The Contract Authorization screen will be displayed
138. ed group of users The users will receive the alert on their screens if they are logged into Oracle FLEXCUBE 7 16 ORACLE 7 2 Processing a CLS deal You can process a CLS deal in the FX Contract screen You can invoke the Foreign Exchange Contract Input screen by typing FXDCONON in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Product Code Counterparty Dealer Source Product Description Main Buy Sell Bought Currency Bought Amount Bought Value Date Booking Date Deal Rate Broker Customer Spread Option Date Internal Remarks Risk Percent Risk Weighted Amount NDF Currency NDF Fixing Status Settlement Currency Input By Date Time poc4 Rollover Instructions 0 Foreign Exchange Contract Input il Netting Revaluation Details Buy Sell Limits Tracking Required Non Deliverable Forward Detail Authorized By Date Time P Contract Reference Number External Reference Number User Reference Number Leg Number Related Reference Number Sold Currency Sold Amount Sold Value Date Base Rate Local Currency Spread Definition Outstanding Balance NDF Fixing Date Settlement Amount NDF Basis a Sas anaa 2 SSS S SSE a EES Saal Events l Option Brokerage Change Log Settlement Advices Messages Charges ma Track Settlement Risk Track Pre settlement Risk Track Weigh
139. ed in the CLS Directory for CLS Participant Type CLS Bank If the counterparty is a Third Party participant then the Receiving Agent is the BIC of the Settlement Member for the Third Party as maintained in the CLS Directory The Intermediary will be the BIC of the CLS Bank If the counterparty is a CLS Participant but not maintained in the CLS Directory then the Receiving Agent Account with Institution is maintained in the CLS Directory The Intermediary is the BIC of the CLS Bank Settlement Parties validations for the Bought side of the deal The following verifications will be done by the system The Delivery Agent Field 53 is same as Field 57 of the Sold side The Intermediary Field 56 is the BIC of the CLS Bank as maintained in the CLS Directory for CLS Participant Type CLS Bank The Receiving Agent Field 57 is the BIC of the Settlement Member as maintained in the FX Branch Parameters CLS Preferences screen If the second level check fails the system will display the following over ride message 7 18 ORACLE e f you choose OK the system will proceed with the deal with module as FX There will This will not be saved as a CLS Deal OK to proceed be no settlement re pickup in this case e If you CANCEL the over ride you have the option to make the required corrections so as to satisfy the second level check On s
140. ed or Due as uploaded from the web service or received from MT398 e Funding Cut off Date The funding cut off date for the deal currency e Funding Cut off Time The cut off time for the deal currency e Reference Number Reference Number of the Treasury System if the contract was received from the Interface otherwise the Oracle FLEXCUBE Contract Reference Number e Their Reference Number Reference Number of the Counterparty or the Settlement Member e Value Date The maturity date of the deal e Counterparty Deal Counterparty e Bought Currency The buy currency of the deal e Bought Amount The buy amount in the buy currency 8 4 ORACLE e Sold Currency The sell currency of the deal e Sold Amount The sell amount in the sell currency e Exchange Rate Deal Exchange Rate e Message Generation Time The time of generation of the message in Oracle FLEXCUBE With the query results the system will enable the fields Value Date and Currency 8 1 2 1 Modifying CLS Statuses You can unlock and modify the CLS status information pertaining to specific records Select one or more records to be modified and click unlock button With this action the system will disable the fields Value Date and Currency You can modify the CLS status and CLS settlement status information provided under the CLS status block Once you have made the changes click Assign button System will assign the modified
141. efine the maximum tenor for the product as six months Now an FX input clerk cannot enter a deal involving FXFW with a tenor that exceeds six months The clerk cannot enter the following deal involving FXFW where the e Value Date 7 March 09 and the e Settlement Date 8 September 09 Indicating the Contract Details to be Rekeyed All contracts entered in the system should be ratified or authorized by a user with the requisite rights This is a security feature When creating a product you can indicate if the authorizer of contracts involving the product needs to rekey important contract details This is to ensure that the contract is not mechanically authorized If you opt for rekey of details click on the button against Yes under Rekey required field Rekey Required Select Yes if you want to rekey the details else select No ie ORACLE 4 2 1 2 Selecting Fields for Rekey Counterparty Check this box if you want the counterparty details to be rekeyed Deal Currency Check this box if you want the deal currency details to be rekeyed Deal Amount Check this box if you want the deal amount details to be rekeyed Value Date Check this box if you want the Value date details to be rekeyed Exchange Rate Check this box if you want the exchange rate details to be rekeyed You can specify any or all of the above details for rekey Under Rekey Fields you can indicate which of the details that you woul
142. ember Continuous Linked Settlements Bank Settlement Member Settlement Member Description Fields Input By DOC4 Date Time Modification Number Cancel Authorized By Date Time Specify the following details Bank Identification Code You have to select the BIC of the CLS party to determine the participant type On selection of the BIC the name of the customer is displayed alongside CLS Participant Type You can identify a CLS party as a Direct or an Indirect participant The system will use the participant type as a criterion to determine the CLS eligibility of an FX deal The participant type can be one of the following e Third Party If the participant type is Third Party the customer will be required to subscribe to the CLS bank via a Settlement Member In this type the party will be indirectly associated with the CLS bank e Settlement Member In this type the customer will be a direct CLS participant e CLS Bank This will identify the customer as the CLS Bank The BIC for the CLS bank will be maintained as CLSBUS33 Settlement Member As stated above if the participant type is defined as Third Party the CLS deals will be processed via a settlement member You have to select the BIC of the Settlement Member in this field The name of the member will be displayed alongside 7 10 ORACLE 7 1 9 Specifying UDF Values You can associate values to all the User Defined f
143. enaes 7 10 7 1 9 Specifying UDE Values cscscesscbesseecavasctevuscesciun uasuogentvsntobvitestesuearesdunveansdseutevedsenvestescvusneabesmenstieeteyed 7 11 7 1 10 Maintaining Settlement Instructions for CLS Deals 1 cccccccccecseesseesseeseesecesecesecusecaceeaseeseenseeaeeeneens 7 12 7 1 11 Maintaining Alert Preferences for CLS dedls c cscccccscesccesessseseeseesecneesecnceeeeseeecesecseesecaaeeeenaseeeeaeenes 7 14 ZAJ Specifying UDF Values issnin a E A a E T EE 7 16 7 2 PROCESSING A CLS DEAL oii c csdcscccetececsetscesctersescaseticesascttecctsettes EEEE REEERE EEEE E AEE 7 17 7 2 1 Checking the CLS Eligibility of an FX dedl sccccssccsssscesessceseeeeseceesecseeecseesceseeseesecaeeseeeaeeeseaseneeas 7 17 7 2 2 Processing a CLS deal as a nOn CLS deal ccccesccscesccssesseseeseesecseesecceeeceseeseeecaeeceeaecaeeseseaeseseaseaeeas 7 21 7 2 3 Processing a CES denli ee e ee T tin tats E hues antsbeess E e e e 7 21 7 2 4 Message Generation for CLS deals siisii irnir i e e E E ERE E E E A 7 21 8 ANNEXURE 1 WORKFLOW FOR CLS DEAL SETTLEMENT sssseesesesseeesesoeseseeccoerosoesesesoeoeseseseeceseee 8 1 8 1 CLS DEAL SETTLEMENT 2ies2i c2edianecticsteecis cecbsbiaciaisoes eie nana kir EAT EAEAN E EEE EEEO AAEE KNEE E EN EAT EE EEEE 8 1 8 1 1 CLS Status Processing sriontennen a a E o E a 8 1 8 1 2 Viewing CLS Status Information ssssseesessesseseeseseeesrsreersresreserrresrsressrsresrsserrnertrssesreessseesresenereees 8 4 8 1 3 Viewing CL
144. ency Sold Currency Yes 03 Alphanumeric The sell currency of the deal Sold Amount Yes 14 Numeric The sell amount of the deal in the sell currency Exchange Rate Yes 16 Numeric The Exchange Rate applicable on the deal On upload the CLS deal status information will be updated in the CLS Deal Status Browser For Alleged Trades a new record will be inserted in the browser Our Reference Number will not be applicable in such cases Deals without Matched status will be resolved manually ORACLE 8 1 2 Viewing CLS Status Information You can view and modify the CLS status and other details of the deals in the CLS Status Browser You can invoke the CLS Status Browser screen by typing FSDSTSBR in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button CLS Status Browser Value Date Currency LBL_CLS_ST_BRWSER C LBL_MODIFIED Authorisation Status LBL_CONFSTATS LBL_CLS_STATUS LBL_CLS_SETTLE_STATUS Reference Number LBL_CLS_STATUS LBL_CLS_SETTLE_STATUS You can query the CLS details from this screen The following details will be displayed for deals other than alleged trades e Authorization Status Authorized or Unauthorized e Contract Status Active or Reversed e Confirmation Status Confirmed or Unconfirmed e CLS Status Status as uploaded from the web based service swift of the Settlement Member e CLS Settlement Status Settl
145. ending de l details e nenea no a reie Kra E Ea E aao a E Eo aaaeaii 6 41 6 8 2 Uploading the contracts for AMCNAMENL cscesccssesscesecssetscuseeseseescesecasesecaceuscaeecaesecaeesscaeeeeeeaeeneeas 6 42 6 8 3 Identifying Financial and Non Financial fields for Amendment ssosoeeeeeeeeee 6 43 6 8 4 COPYING contract details ioris nian nnn i an iena aiee eae raei a inen aeaea 6 44 6 8 5 Viewing different versions of the contract cceccsccssessseseessesscsseeseuseeseesecatesecsceeeesecsceeeesaeeateaeeaaeseeneeeas 6 44 6 8 6 Deleting a Contract sissie ai pno a ea iro ar En Eaa EEEE a E SENEE E ENA E ORERE 6 44 6 8 7 Reve rsin G CONTACT ses niae en A EERE E R A E E A E ERES 6 45 6 8 8 Reversing and Rebooking a Contract ccsccssssssssseseessesecssesecuseseceseeseesecasesecseeecesseeaeeaecaeeaeeaeeaeeseenanaes 6 45 6 8 9 Putting a Contract On Holdin inaa aia r a arie a aa S a a ai 6 46 6 8 10 Multilevel Authorization of a Contract ssessesseeeseseesseeereseseeesrereerrsersresesrsserrrnsesrensrsrenresersresereree 6 46 6 611 A thorizing a CONTTACE renani A E E EEA E E ERS 6 46 6 8 12 Authorizing Bulk FX CONTACiS seiseanan an AEE R RE I Eaa 6 49 6 8 13 Authorizing the CONrACtS secsseeccesecssessesseenssseeccesecasescaceecesseeasenssasensesecaeeseseeeeeesaseaesascaseseeaeeeeens 6 50 6 814 Viewing the Cr vOTS ciiasan aenea aiaa NEE a Aa a aea ERRER iaai 6 51 6 8 15 Viewing the Settlement Details ssoeeeoeeeseseeneeeseeseeeeeressseresre
146. eport Days after Contract booking Days before Maturity Report Period Number of Days 12 21 1 Contents of the Report The contents of brokerage confirmation report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body You can find the following details in the body of the report Contract The identification number of the contract Reference No Broker Code The identification code of the broker Name The name of the broker Deal CCY The deal currency Value Date The date on which contracts are to be settled eee ORACLE Contract The identification number of the contract Reference No Amount The total amount No of days The total number of days tenor of the contract 12 22 Contract Maturity Due Report Contract maturity due report provides information on maturity date sold currency bought currency sold amount and bought amount of contracts To invoke the screen type FXRPCNMD in the field at the top right corner of the Application tool bar and click the adjoining arrow button Foreign Exchange Instruments Falling Due for Redemption Foreign Exchange Instruments Falling Due For Redemption Date From Date To Date All Custome
147. eport Click Exit if you do not want to generate it Contents of the FX Daily Activities Report The contents of FX daily activities report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body For contracts involving each activity that has been selected the following details will be reported Contract Reference No The Reference number of the contract Event Code The name of the event code Description The description about the event Ex Rate The rate at which currencies are exchanged Customer No The code of the customer involved in the contract Short Name The Short Name of the customer from the Customer Base Record Deal Currency The S W I F T Code of the deal currency Deal Amount The amount involved in the contract in the deal currency Term Currency The S W I F T Code of the term currency Euro Equivalent The euro equivalent amount of the foreign exchange transaction LCY Equivalent The local currency equivalent amount of the foreign exchange transaction Total Buy in Deal Currency The total amount bought in deal currency Total Sell in Deal Currency The total amount sold in deal currency Contract Amt in Deal CCY
148. er than or the same as the From Date specified in the previous field Include Liquidated Contracts Check this option to indicate that details of contracts that have already been liquidated should be included in the report Click OK button to generate the report Click Exit if you do not want to generate it ue ORACLE 12 3 1 Contents of the FX Currency Analysis Report The contents of foreign exchange currency analysis report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body The following details will be reported for contracts involving a particular currency Contract Reference No The identification number of the contract Value Date The date on which contracts involving the currency are to be settled CCY The S W I F T Code of the currency whose position is being reported CCY Balance The current position in the currency LCY Rate The local currency rate that is applied on the CCY Balance LCY Balance The local currency equivalent of the CCY Balance calculated using the LCY Rate Net for Period The total currency position due to contracts maturing within a specified period Currency Bal The balance currency amount Euro Equiv The euro equi
149. es is calculated at prevailing rates Also the previous FCY accrual entries are revalued when you run the account revaluation batch function as part of the EOD operations Contract level revaluation of the Discounted Amounts Contingent Amounts is done starting from the booking date till maturity of the contract These revaluations may result in a profit or a loss for your bank on the contract The revaluation entries are passed depending on the frequency you specify On the maturity date the contingent entries are reversed settlement entries are passed into the nostro accounts for the full deal amounts and the interest receivable and the interest payable are booked into the FX gain loss GLs TIE ORACLE The method is explained using the example below Example Let us assume a buy deal where you are buying 50 000 GBP deal currency against the sale of 51 000 USD non deal currency two months from now The deal is booked on 1 January 2009 You enter the forward interests discounts as per the prevailing currency interest rate currency interest rates are also captured for reference for the both legs and the deal amount as e 2000 for GBP Interest receivable on bought currency 2 months hence and e 1000 for USD Interest payable on sell currency 2 months from now Therefore the discounted deal amounts are e GBP 50000 2000 48 000 e USD 51 000 1000 50 000 Accrual and revaluation are scheduled on the foll
150. es any existing entries in Exchange P amp L GLs as also forward premium discount accruals Revaluation at Product Check this box to enable the passing of a consolidated revaluation entry at the product level for all forward FX contracts under that product User Reference Number in Messages If this option is checked then the user reference number will be used instead of the contract reference number in the following messages e MT103 Field 20 oe ORACLE e MT202 Field 20 Field 21 In case of a cover field 21 will be field 20 of the related e MT103 e MT300 Field 20 e Field 21 e MT304 Field 20 Field 21 3 2 2 Maintaining CLS preferences for the branch Continuous Linked Settlements Participant Customers of your bank can settle their FX deals via the CLS Continuous Linked Settlements Bank to reduce the risks associated with such transactions Check this box to indicate that the branch is a CLS participant Settlement Member Select the BIC of the settlement member to be used for messaging purposes T Copy Check this box to indicate that T Copy identifier is required in the MT300 Message If you check this box the system will include the TPS identifier in MT300 message for CLS NDF deals However the system will not generate MT304 message for the message type FS_FMCOMF Auto Confirm Continuous Linked Settlement Deals Check this box to indicate that CLS deals should be automatically confirmed by the system
151. esk Such deals are usually done to take advantage of prevailing market conditions Example Assume that the interest rate in the interbank market is 15 i e the returns on local currency INR lending will be high The Money Market desk which deals with interbank deals can either lend surplus cash in the interbank market or if the FX desk has surplus FCY like USD then ask them to undertake a USD INR swap to generate INR by paying the premium to the market and lend the same to the MM desk If the Money Market desk chooses the second option then the transaction will be treated as an internal swap You can invoke the Internal SWAP Product Category Maintenance screen by typing FXDISPCM in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button internal Swap Product Category Maintenance Category Description Foreign Exchange Spot Product Description Foreign Exchange Forward Product Description Input By DOCS Date Time Authorized By Date Time Specify the following details Foreign Exchange Forward Interest Product Description Money Market Borrow Product Description Money Market Placement Product Description Modification Number BB authorized open Cancel 4 24 ORACLE Product Category You need to specify the Product Category for internal swap transactions Product Category Description Enter a small description for the
152. etted amounts in the net inflow outflow details and accordingly increase decrease the utilization depending on old and new netted amounts During deletion or reversal of the contract the system will always force decrease the utilization of the credit line irrespective of the type of line The same logic will apply for other events like Liquidation Amendment cancellation and Rollover In all these events new netted amount is calculated using liquidated amended cancelled amount and the system will either decrease increase utilization based on old and new netted amounts If the option Netted Limit Tracking for Pre Settlement Risk is set for the contract then system will net the revaluation gain loss of all such contracts using netting limits reference of the contract If the netted amount is a revaluation gain then the system will create utilization for the difference between the total gain amount and old utilization If the netted amount is a revaluation loss then no utilization will be done and the previous utilization if any will be nullified The BOD revaluation reversal process will reinstate the limit utilization for pre settlement risk During limits tracking the credit lines will be picked from netting agreement for the counterparty one ORACLE 6 2 14 Upload FX contract upload will also be enhanced to default the value of the netted limit tracking options from the limits netting agreement FX contract upload functionality w
153. ey will behave like independent transactions cae ORACLE 7 1 7 Continuous Linked Settlements CLS Introduction Continuous Linked Settlement CLS is an industry initiative to eliminate the settlement risk in foreign exchange transactions This is achieved by using a payment versus payment method which provides a simultaneous exchange of currency values through CLS Bank International The CLS concept is being adopted globally with a view to reduce the risks involved in settlement of Foreign Exchange transactions Before CLS each side of a trade was paid separately Taking time zone differences into account this heightened the risk of one party defaulting CLS is a real time system that enables simultaneous settlement globally irrespective of time zones CLS is an ongoing process of e submitting instructions receiving payments of specified currencies from customers e funding settling pairs of instructions that satisfy all criteria e execution making pay outs in specified currencies Settlement is final and irrevocable or funds are returned same day Participating banks get real time settlement information that helps them to manage liquidity more efficiently reduce credit risks and introduce operational efficiencies The members of the CLS Bank referred to as the Settlement Members submit the deals through the CLS Bank which in turn will match the deals and settle the same by debiting crediting their accounts in ac
154. f time The time is with respect to the branch time zone Trade Cut off Minute Specify the trade cut off time in minutes Cancellation Cut off Days Specify the cut off days for canceling a CLS deal Cancellation of CLS deal should be done before the cancellation cut off date and time If the cancellation is done on the cancellation cut off date equal to the current date the system will validate that the cancellation time on the cut off date is within the cut off time maintained for the currency The time is with respect to the branch time zone If the cancellation is done after the cancellation cut off date time the system will display an override message stating that the cancellation cut off date time has passed If you select Ok the deal will get cancelled If you select Cancel for the override the deal will not get cancelled Cancellation Cut off Hour Specify the cancellation cut off time in hours Cancellation Cut off Minute Specify the cancellation cut off time in minutes Funds Completion Cut off Days Here you have to capture the funding cut off period for a deal This will ensure that the funds are made available before the settlement date of the deal This value will be used only for information purposes Again the time is with respect to the branch time zone Funds Completion Cut off Hour Specify the cut off time in hours for the making the funds available 7 6 ORACLE Funds Completion Cut off
155. f you change the Deal Rate from 0 5 to 0 6 the Sold Amount will be changed to GBP 1200 Similarly when you are liquidating a Sell Type of FX Contract you can choose to change either the Sold Amount or the Deal Rate Accordingly the system will calculate the Bought Amount Value Date This is the date on which the contract was liquidated or cancelled Remarks While liquidating or canceling an FX deal you can enter information about the deal intended for your bank s internal reference This information will not be printed on any correspondence with the customer Premium Discount This indicates whether the contract results in a premium or a discount Premium Discount Amount The difference between the Spot Equivalent in LCY and the Contract Amount in LCY is the Premium or Discount Amount A minus sign indicates that the contract is at a discount eee ORACLE 6 9 1 For contracts involving the local currency the local currency is taken as the P amp L Currency When such a contract is revalued the Spot Rate of the P amp L Currency as on the revaluation date is applied on the contract amount to calculate the Spot Equivalent in LCY The difference between the Contract Amount in LCY and the Spot Equivalent in LCY is the Premium or Discount Amount A minus sign indicates that the contract is at a discount For cross currency contracts the Spot Rate of the P amp L Currency as against the other currency is used to calculate th
156. ference is made in the netting agreement maintenance of the counterparty and the corresponding mode is reflected here also If you choose No Netting as the Netting Type Mode of Netting will be reset as a blank value 6 2 6 1 Bought Leg Specify the following details Neiting Date Specify the date on which you want to net the bought leg of the deal oes ORACLE Value Date This is the date on which the bought leg of the contract is to be settled Settlement Account Specify the settlement account to be used while netting the Bought leg of the deal Risk Netting Reference Number The reference number being used to utilize the limit for the netted amount for the bought leg will be displayed here Fund Transfer Reference Number The reference number of the funds transfer used for netting the bought leg is displayed here Netting Reference Number The netting reference number of the bought leg is displayed here Funds Transfer Status The status of the funds transfer involved in the netting of the bought leg is displayed here Related Foreign Exchange Contract Specify the related FX contract for netting 6 2 6 2 Sold Leg Specify the following details Netting Date Specify the date on which you want to net the sold leg of the deal Value Date This is the date on which the sold leg of the contract is to be settled Settlement Account Specify the settlement account to be used while netting the sold leg of the deal Risk
157. for the liquidated amount will be posted to the account The contract status is updated as liquidated and auto authorized Each leg of a contract involving a product combination will be liquidated individually Retrieving information The Contract Activity report for the day will provide details of contracts that were liquidated automatically during the day If a contract that had to be liquidated was not liquidated for some reason it will be reported in the Exception Report for the day The reason for the contract not being liquidated will also be reported in the Exception Report If so required by your bank you can setup this function as an End of Day process a ORACLE 5 3 Automatic Rollover of a Contract All contracts that have been specified for automatic rollover will be rolled over when you run the Automatic Rollover process The auto rollover process is invoked when you run the auto liquidation process The validations When you run the auto rollover process at the Beginning of Day a contract will be rolled over if e Itis marked for auto rollover e Itis authorized e The Value Date of the contract is less than or equal to the current system date In case a holiday precedes the next working day those contracts that mature on the holiday and marked for rollover will also be rolled over That is when you run this function all contracts with a Value Date between today and the next working day will be rolled over Example
158. gible deal as a non CLS deal by selecting the Exclude From CLS option at the time of capturing the contract details in the FX Contract screen In this case the contract will be processed as a normal FX contract 7 2 3 Processing a CLS deal For CLS eligible deals where the Exclude From CLS option is not selected the system will perform the following as part of deal processing The SGEN event Settlement Message Generation will be suppressed for CLS eligible deals The Payment and Receive messages the Debit and Credit advices will also be suppressed The CLS deals will not form part of the Netting Agreement and hence will be excluded from the FX netting process both auto and manual The accounting entries will be posted to the Control Accounts at the individual deal level When you save the contract the system will check whether the Settlement Accounts are CLS Control Accounts the Pay Receive accounts maintained for the module FS Settlement instructions with module FS will be picked up selectively for the amount tags SETBOTAMT Bought Settlement Amount and SETSOLDAMT Sold Settlement Amount During amendment if a CLS deal becomes a non CLS deal the system will display an error message Amendment of CLS deals will be allowed only if the CLS Status is Matched or Un matched In the case of New Amend and Reverse operations the CLS Status will be updated as Un match
159. h product type you can create any number of products Slogan Enter a slogan for the product Group Select the group to which the product belongs Start Date Select the date from which the product is effective ve ORACLE 4 2 End Date Select the date till which the product can be used Remarks Enter any additional remarks about the product Indicating Preferences for a product Preferences are the attributes or terms defined for a product that can be changed for a deal involving the product By default an FX deal acquires the attributes defined for the product to which it belongs However the attributes that are defined as the product s preferences can be changed for a deal To invoke the Preferences screen click Preferences button Foreign Exchange Product Preferences Product Code Description Preferences Additional Forward Tenor Type Rolling Tenor Fixed Tenor Input Mode INPUT AND UPLOAD v C Option Date Allowed Max Tenor In Months Contract Authorisation Method NPV Rekey Required Yes No Rebate Straight Line Fields Discounted Straight Counterparty Line Deal Currency Deal Amount Value Date HAA E Exchange Rate Override Limit Stop Limit Non Deliverable Forward Detail NDF Indicator Default NDF Currency x NDF Basis
160. half of a customer the SWIFT message MT202 General Financial Institution Transfer is generated When the liquidation of a buy or sell FX deal is reversed the system automatically generates an MT 292 and sends it to the same party to whom the earlier SWIFT message was sent requesting for cancellation of the message The MT 292 will contain the following details e The Reference Number of the deal e The Reference Number of the SWIFT message being cancelled e The original message type sent e The date of the original message and e The text of the original SWIFT message optional The MT292 is generated for the reversal of a contract full payment REVR or the reversal of the last payment REVP where the contract is partially liquidated but only in those cases where an MT202 was generated on full partial liquidation If the receiver of the original SWIFT message has already acted upon the message the MT292 will ask for a retransfer reversal request with the consent of the receiver Note the following e In order to enable generation of MT292 on reversal of an FX contract you need to maintain the advices FX_REVERSAL and REVSWIFT for the product event REVR e An MT 292 will be generated when a deal is reversed only if you have associated the advice tag PAYMENT_MESSAGE to the reversal REVR event Messages In addition to advices you can generate messages for a counterparty For example when you make a payment
161. hall examine the accounting entries and advices for each of the events listed below Event Event Description Remarks Code BOOK Booking All Types AMND Amend All forward contracts before settlement messages are generated CONF Confirmation All Types CANC Cancellation All Types LIQD Liquidation All Types REAS Reassign User All Types REVR Reversal All Types ROLL Rollover All forward contracts REVL Revaluation Spot and forward contracts RRVL Deal level revaluation Spot Forward contracts with Rebate NPV reversal revaluation methods and Forward contracts with Straight Line revaluation method SGEN Settlement Messages All Types FIXG NDF Forward Contract This event is processed for a NDF Forward Contract Fixing when the NDF Fixing contract is booked against it UFIX NDF Forward Contract This event is Processed for NDF Forward Contract Unfixing To Reverse All Accounting Entries On Reversal Of NDF Fixing Contract i ORACLE 10 3 Amount Tags The amount tags listed below are hard coded in Oracle FLEXCUBE Amount Tag Description AMORTEXP Premium Discount Expense AMORTING Premium Discount Income BOTAMT Bought Amount CONTLCYAMT Contract LCY Equivalent Amount REVLOSS Revaluation Loss REVLOSS_PY Revaluation Loss Previous Year REVPROFIT Revaluation Profit REVPROFIT_PY Revaluation Profit Previous Year ROLLBOTAMT Rollover Bought Amo
162. he bought currency and bought amount indicate the value date for the bought leg in the Value Date column Sold Value Date Enter the value date for the sold leg of the contract in the Value date column Similarly against the sold currency and sold amount indicate the value date of the sold leg of the contract The Value Date will be the same except in the case of Split Value Date deals Booking Date This is the date on which the contract begins The system defaults to today s date which can be changed e This date cannot be earlier than the Start Date or later than the End Date of the product e This date should be earlier than or the same as the Value Date of the contract a9 ORACLE Deal Rate Based on the counterparty the Currency Pair and the Value Date for the transaction the System automatically assigns the deal rate that is to be used for the FT deal if currency conversion is involved The Deal Rate applicable for the transaction Base Rate Customer Spread depending on whether it is a Buy or a Sell Base Rate The Base Rate is derived from the Mid Rate and the Buy Sell Spreads that you maintain for the currency pair in the exchange rate maintenance table Local Currency The local currency equivalent of the contract amount will be displayed in this field The local currency amount is calculated as follows In case of a direct quote currency LCY FCY x Rate In case of indirect quote currency
163. he Toolbar or e Select Save icon as ORACLE 6 2 13 FX Contracts Processing with Netted Limits Tracking The risk tracking on the netted amounts of the FX contracts will be done only when the netted risk tracking options are checked at the contract level Netting screen of FX contract The risk tracking on netted amounts will be done even when the contract is not marked for netting of settlements The settlement netting and limits netting are totally independent features The non netted risk tracking options and netted risk tracking options are totally independent features In case both are checked then Oracle FLEXCUBE supports tracking of risk contract wise as well as netting bucket wise In case both features need to be tracked it is better you maintain a separate set of credit lines The system will not cross validate the credit lines maintained for contract wise risk tracking and netting bucket wise However the system will validate the credit lines maintained for netted risk tracking alone The netted risk tracking will be done on both bought leg and sold leg separately The risk netting reference number of the bought leg in FX contract online will identify the contracts for which the bought leg is tracked The risk netting reference number of the sold leg in FX contract online will identify the contracts for which the sold leg is tracked Oracle FLEXCUBE will internally store the net inflow outflow amount for both sold and b
164. he activity was not performed You can choose to include only certain activities or all activities that failed through the Report Options screen To invoke the screen type FXRPEXP in the field at the top right corner of the Application tool bar and click the adjoining arrow button Foreign Exchange Exception Report Options Foreign Exchange Exception Report Activities All O Single Activity Report For In this field you can specify which exceptions are to be reported If you select e All Activities All automatic activities that did not take place today will be reported e Selected Activities Only those activities that you select in the next field will be included in the report Activities A list of all FX related activities is displayed here If you have chosen the Selected Activities option in the previous field you can select the activities exceptions that you want to include in the report The details of contracts on which these exception conditions have occurred will be reported To remove an activity from this list uncheck the corresponding checkbox Click OK button to generate the report Click Exit button if you do not want to generate it ae ORACLE 12 11 1 Contents of the FX Daily Exception Report The contents of FX daily exception report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID mo
165. he unauthorized FIXG event of the NDF Forward Contract update the related reference number and fixing status and compute the settlement amount Amendment Not Allowed Reverse Not Allowed Liquidation Not Allowed SGEN Not Allowed Authorization Authorize the unauthorized event FIXG UFIX of the NDF Forward contract SGEN After the Settlement days of the NDF Forward contract SGEN will be executed Liquidation If Fixing has been done the SGEN is executed and maturity date is reached then LIQD executed Amendment If LIQD or SGEN for the NDF Forward Contract is fired then NDF Fixing Contract cannot be amended Otherwise Execute unauthorized version of FIXG event with the new settlement amount Delete Delete the unauthorized FIXG version of NDF Forward Contract related to the Fixing Contract one ORACLE NDF Forward NDF Fixing Action Contract Contract Reverse Execute the UFIX for the NDF Forward Contract and rollback all changes for the NDF Forward Contract IF LIQD has been executed for the NDF Forward Contract then reverse all the entries and make NDF Forward contract active again but only in unfixed status Amendment Allowed Reverse Allowed Deletion Allowed 6 2 4 4 External SWAP Ref This is the swap reference number generated by the external system for the FX Swap deal In case of amendment by reversal of parent and rebooking when a child contract is booked the External swap reference of th
166. he uploaded record For a contract requiring amendment the action code will be AMND If the action code is AMND Oracle FLEXCUBE will first check whether the contract exists in the system or not If the contract does not exist in the system an error message will be displayed to notify that the contract cannot be amended The Reference Number provided by the external system has to same if it is a new contract or if it is an amendment to an existing contract When you upload a new contract the Reference Number will be displayed in the User Reference Number field for that contract The User Reference Number will be the basis for checking whether the contract exists or not The upload for contract amendment will trigger the AMND event The same event is triggered even when the amendment is done in the FX Contract screen The fields that can be amended for the FX module are as follows e Internal Remarks one ORACLE e Credit Line and e Settlement Information 6 8 3 Identifying Financial and Non Financial fields for Amendment Oracle FLEXCUBE will not allow you to make amendments to the fields that are having financial impact Therefore you need to first identify the set of fields those are having financial impact In FX contracts following are the fields that are classified as financial fields e Branch e Counterparty e Buy Sell Currency e Sold Currency e Net Settlement Risk e Net Weighted Risk e Net Pre
167. header The details in the report fall under two categories The master part contains the following information e FT Contract Reference Number e Currency e Amount e the Debit or Credit indicator with respect to customer e Value Date e FT upload status e Netting Type The detailed section of the report contains the following information e FX Contract Reference number e FX Contract Status e Amount e Debit or Credit indicator debit for Bought and credit for Sold Netting Status of the contract 12 18 FT details for a Foreign Exchange Contract This report gives netting details of a selected Foreign Exchange contract You can generate this report for one or several contracts The report gives the netting details for a specified customer and date You can generate this report any number of times during the day You can generate this report for e A specific date or a date range a ORACLE A specified customer a list of customers or all customers The date for which the report is generated is displayed in the header The details in the report fall under two categories The master part contains the following information FT Contract Reference Number Currency Amount The Debit or Credit indicator with resp Value Date FT upload status Netting Type ect to customer The detailed section of the report contains the following information FX Contract Reference Number FX Contract Status Netting Type Netting Status Sold
168. hived data will be purged based on the Retention Period defined for the status Purge of CLS Browser Data These specifications are maintained in the Purge Details Maintenance screen Refer the Operations User Manual for details on Archival and Purging of data 8 1 4 Bulk Authorization of CLS Statuses You can view and authorize multiple CLS statuses at once using CLS Status Authorization screen To invoke the screen type FSDSTSAU in the field at the top right corner of the Application tool bar and click the adjoining arrow button CLS Status Bulk Authorization Value Date _ Currency CLS Status Alleged x CLS Authorization Status 7 Reference Number Their Reference Number Counterparty Value Date CutOffDate CutOffTime Bought Currency You can query the records based on the following parameters Value Date If you wish to search the records based on the value date specify the date here Choose the appropriate one using the calendar button Currency You can query the records based on the currency Choose a currency from the option list CLS Status You can search for Alleged as well as CLS records using this screen Choose the CLS status from the drop down list 8 9 ORACLE Based on the search criteria the system displays the modified details of the CLS or alleged records Use the checkboxes adjoining the records to mark them for bulk authorization Further click A
169. horization Statu Cancel s T ORACLE For any product you create in Oracle FLEXCUBE you can define generic attributes such as branch currency and customer restrictions interest details tax details etc by clicking on the appropriate icon in the horizontal array of icons in this screen For a foreign exchange product in addition to these generic attributes you can specifically define other attributes These attributes are discussed in detail in this chapter You can define the attributes specific to a deposits product in the Foreign Exchange Product Definition Main screen and the Foreign Exchange Product Preferences screen In these screens you can specify the product type and set the product preferences respectively For further information on the generic attributes that you can define for a product please refer the following Oracle FLEXCUBE User Manuals e Products e Interest e Charges and Fees e Tax e User Defined Fields e Settlements Code Specify the code of the FX product Description Enter a small description for the product Type The first attribute that you define for a product is its type You can broadly classify products into two types in the Foreign Exchange module of Oracle FLEXCUBE Spot and Forward Example You want to create a product for GBP USD spot buy deals called BuyGBP When you define the product you would indicate that the product type of this product is Spot Under eac
170. hose contracts marked for automatic netting for the specified customer Netting will be done irrespective of the currency chosen Manual netting process can be initiated for contracts that are marked for manual netting and auto netting Netting will be done only for those contracts that have specified a currency currency pair unless you have chosen All option The following steps involved in netting are done irrespective of the mode of netting chosen If you have chosen Netting Agreement as the Netting Days Basis for the customer the netting days will be picked up from the netting agreement screen If you have chosen Currency as the Netting Days Basis the FX netting days will be picked up from the currency definition screen for the bought sold currency If FX netting days is not specified for a currency netting days will be the same as spot days Currency wise netting is done for each customer for all currencies if the netting mode is automatic and for specific or All currencies if netting mode is manual Pair wise netting is done for each customer for all currency pairs if it is automatic mode and for specific or All currency pairs if the netting mode is manual eee ORACLE 6 2 9 1 If the netting days basis is set as Netting Agreement then the Netting days will be picked up from the netting agreement screen for that customer If the Netting Days basis is set as Currency then the FX
171. ic to FX Products Introduction Broadly speaking to meet your requirements you will enter into two types of foreign exchange deals They are e Spot deals e Forward deals Spot deals When a foreign exchange deal is settled within spot days usually two days of entering into the deal it is referred to as a Spot Deal While spot deals settle on the spot date e Cash deals settle on the same day e Tomorrow or TOMS settle on the next working day Forward deals A foreign exchange deal that is settled beyond the spot days of entering the deal is referred to as a forward deal In this chapter we shall discuss the manner in which you can define attributes specific to a Foreign Exchange FX deal as a product You can create FX products using the Foreign Exchange Product Definition screen You can invoke the Foreign Exchange Product Definition screen by typing FXDPRMNT in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button In this screen you can enter basic information relating to a deposits product such as the Product Code the Description etc Foreign Exchange Product Definition Product Code Product Type Spot Product Description Forward Slogan Product Group Start Date End Date Remarks Date Time Record Status Checker Date Time Aut
172. idation marked as YES The MM Products should have payment type as Bearing The MM products should have rollover set to NO The MM products should have only one interest component main defined for the principal amount The rate type of the main interest component should be fixed for both MM products The schedule type for the principal and the interest component should be BULLET at the MM product level The FX products should have Cross Currency deals allowed set to YES The FX products should have rollover allowed set to NO The FX products should have Auto liquidation allowed set to YES mee ORACLE 5 Beginning of Day Operations 5 1 Introduction Before you enter FX transactions in the system you must perform certain operations referred to as Beginning of Day operations The following are the Beginning of Day operations that you must perform e Maintain the exchange rates for currencies e Maintain discount and forward rates e Liquidate contracts that are marked for auto liquidation e Rollover contracts that have been marked for auto rollover e Run the deal level revaluation reversal batch process only if you have opted for deal level revaluation reversal while defining FX Branch Parameters You can maintain the exchange rates for a currency daily in the currency table The forward and discounting rates for a currency are maintained in the Forward Rates and Discounting Rates Maintenance tables respectively Forward and Discou
173. ields created and attached to the CLS Directory screen You can view the list of User Defined fields associated to this screen by clicking Fields button on the CLS Directory screen User Defined Fields User Defined Fields C Field Name O You can enter the value for the UDFs listed here in the Value column For more details on how to create user Defined fields refer chapter Creating custom fields in Oracle FLEXCUBE in the User Defined Fields User Manual under Modularity 7 1 9 1 Uploading CLS Directory Information to Oracle FLEXCUBE You can automatically upload the CLS Directory information from an external source on to Oracle FLEXCUBE The uploaded data will be populated in the CLS Directory You can specify the upload details in the CLS Bank Directory Upload screen invoked from the Application Browser You can invoke the Bank Directory Upload screen by typing FSDBICUP in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Bank Directory Upload Source Code Upload Upload Time Total Processed Total Rejected Specifying the Upload Source and Date You can select the source from which you want to upload the details into Oracle FLEXCUBE from the option list provided 7 44 ORACLE It is assumed that the upload source contains details of all relevant BIC codes The BIC records that are u
174. ies are passed Reversal of the contingent entries passed on the booking date Cr Cont Discounted bought amount gt GBP 48 000 LCY equiv EUR 50 100 Dr Cont Discounted sold amount gt USD 50 000 LCY equiv EUR 50 100 The LCY value of both the legs is same as the LCY equivalent of the discounted amount of the non deal currency as calculated during booking at the rates prevalent on the booking day Accrual entries for the interest amount on 28 Feb al ORACLE For GBP Dr Interest receivable bought currency 949 15 LCY Equiv 949 15 1 04 987 12 Cr Interest Income 949 15 At the spot rate of 1 04 For USD Dr Interest Expense 474 58 LCY Equiv 474 58 1 02 484 07 Cr Interest Payable on sold currency 474 58 At the spot rate of 1 02 Reversal of accruals converted to LCY equiv at the spot rate of 28th Feb For GBP Dr Gain Loss GL 2000 2080 EUR LCY equiv of 2000 GBP at the GBP spot rate of 1 04 Cr Interest receivable bought 2000 2080 EUR currency GBP For USD Dr Interest payable sold 1000 1020 EUR LCY equiv of 1000 USD at the spot currency USD rate of 1 02 Cr Gain Loss GL 1000 1020 USD NOSTRO Entries Settlement entries are passed for the actual deal amounts Dr Settlement bought GBP Nostro 50 000 EUR 51 102 00 C q Settlement sold USD Nostro 51 000
175. ill be enhanced to update utilizations of settlement risk and weighted risk credit line 6 2 15 Amendment of Uploaded Deals You will be able to amend the uploaded deals in Oracle FLEXCUBE upon pressing the unlock button These deals are the one that are uploaded as unauthorized from external system 6 3 Indicating the Option Period and the Rate For a forward contract having a multi option period you can specify the period for which the forward rate is to be captured After you specify the period you have to indicate the forward rate for the respective period To maintain a forward rates list click on the Option button in the FX Contract Details screen The Multi Option Details screen will be displayed Multi Option Details Multi Option Period Contract Reference Number Option Rate Details F Option period ok Cancel The details captured in this screen are meant for your bank s reference and will not be used while processing the contract ee ORACLE 6 4 Viewing Event details Click on Events in the FX Contract screen to go to the Events screen Along with the details of events that have already taken place on the contract the details of pending events will also be displayed Reference Number Events o Event No Event Date Event Code Description Message Accounting Entries Exit Click on Messages
176. ils If you indicate 10 in this field the query will calculate the discount rates for the Currency Rate Type combination ten days from the query date To execute the query click Query button The discount rate for the Currency Rate Type combination and period that you queried is displayed in the Discount Rate field Discount Rate The discount rate for the currency rate combination is displayed here Netting Details Netting is the process of offsetting the receivables with the payables for a counterparty to generate a single accounting entry in the counterparty s account Oracle FLEXCUBE allows you to net contracts that satisfy certain conditions The Netting facility is useful at the time of contract settlement You can opt to net two or more contracts at the time of settlement if the contracts are e Linked to the same counterparty customer e Have the same Value Date and e Inthe same currency currency wise netting or e Involve the same currency pair pair wise netting Example Assume you have entered into the following FX deals with Cavillieri and Barrett Finance Corporation the counterparty Bought Sold Exchange Bought Sold Value Currency Currency Rate Amount Amount Date USD EUR 1 3 10000 USD 13000 EUR 02 12 09 EUR USD 1 3 6500 EUR 5000 USD 02 12 09 Instead of individually settling these contracts with Cavillieri and Barrett Finance Corporation you can opt to net them Tha
177. ils on maintaining FX Branch Parameters for deal level revaluation reversal Refer to the chapter Beginning of Day Operations for details of running the deal level revaluation reversal batch process If you try to run the deal level revaluation reversal batch in spite of having opted for Account Revaluation as part of FX Branch Parameters definition an error message is displayed The deal level revaluation reversal batch process involves the following For spot forward contracts with NPV Rebate revaluation Revaluation entries posted into the Exchange P amp L GL are reversed If the processing date for the revaluation reversal batch process is the first day of a new financial year the entries posted into the Previous Year Adjustment GL maintained in the Chart of Accounts are reversed This is because while closing the books of accounts for the previous year the balances in the Exchange P amp L GLs would have been transferred to the Previous Year Adjustment GL For details on maintaining Previous Year Adjustment GL refer to the General Ledger Chart of Accounts User manual For forward contracts with Straight Line revaluation Revaluation entries posted into the Exchange P amp L GL are reversed along with Forward Premium Discount accruals Current Premium Discount accruals are not reversed If the processing date for the revaluation reversal batch process is the first day of a new financial year the entries posted into
178. in Local Currency Foreign Exchange Contract Input Contract Reference Number External Reference Number User Reference Number Main Rollover Instructions Netting Revaluation Details Effective Interest Rate Premium Discount PremiumDiscount Amount Bought Premium Discount Sold Premium Discount ie ot gt a Related Reference Number Reversed Reference Number Bill Reference Number Fund Identity Bought Discount Deal Amount Sold Discount Deal Amount DOC3 J J Change Log Settlement Advices Events Option Brokerage ect Meet Input By Date Time Authorized By Date Time Profit and Loss Currency If a forward contract is being revalued using the Straight Line Revaluation method the Messages f J Charges f Tax MIS revaluation details should be specified in this screen 6 30 fi Fields All Messages Cancel ORACLE For contracts involving the local currency the local currency is taken to be the P amp L Currency You cannot change the P amp L currency to any other currency For cross currency contracts you must enter either the bought currency or the sold currency as the P amp L currency Spot Date For contracts involving the local currency the Spot Date of the foreign currency in the pair is taken as the default Spot Date For cross currency contracts the Spot Date of the P amp L Currency is taken as the default
179. in the Currency Definition screen you can allow a currency to be CLS compliant by selecting the CLS Currency option FX deals in the CLS currency only will be eligible to be routed through the CLS bank Further from the available list of CLS currencies you can maintain a list of allowed or disallowed currencies for a specific customer This is explained in the following section Refer the Core Services User Manual for more information on maintaining currency details in Oracle FLEXCUBE 7 1 3 Identifying the customer as a CLS Participant and maintaining currency restrictions At the time of maintaining the details of a customer in the Customer Information Maintenance screen you can mark the customer as a CLS Participant To invoke this screen click on Customer Maintenance in the Application Browser select Customers and click on Detailed under it You can also invoke this screen by typing STDCIF in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button You will be allowed to capture currency restrictions only for customers who are CLS participants You can maintain a list of allowed or disallowed currencies for CLS trading in the CLS Currency Restriction screen Click on the CLS Restrictions button in the Customer Information Maintenance screen to invoke it However you have to ensure that the branch at which the customer operates i
180. in the Product Transaction Limits Maintenance screen the transaction amount is greater than the authoriser s authorisation limit if the Cumulative field is unchecked in the Product Transaction Limits Maintenance screen Note the following When you save the manual payment details the system will check whether the deal is a fixed NDF forward deal Here the bought amount or the sold amount needs to be the same as the contract bought or sold amount associated with the payment Also there should not be any outstanding balance after manual payment You cannot initiate partial payment for NDF forward deals If you try to perform a partial payment for NDF forward deals the system will display the following error ore ORACLE 6 10 Reassigning a Contract to Another User A contract can be deleted only by the user who entered it If a contract has to be deleted and the user who input it is not able to do it you can reassign the contract to another user so that the other user can delete You can perform the reassigning operation in the Reassign User Prior to Authorization screen 5 Foreign Exchange Contract Reassign Product Contract Reference Number Current User Identification New User Identification Typically this situation may arise during end of day operations when a contract that is not authorized has to be deleted and the user who input it has left the office for the day You can invoke th
181. input form Product Code Based on the type of contract that you are entering you have to select a product or a product combination that you have maintained in the branch ORACLE Example You have created several products for forward deals involving USD and GBP For example you have created the following products e Sell US bank for banks e Sell US individ for individuals Assume you want to enter a forward deal with Global Bank as the counterparty in USD and GBP When you enter this deal in the Contract Input Form you would click on option list icon in the Product Code field A list of all the products that are maintained in your bank including Sell US bank will be displayed Choose Sell US bank or SUSB1 the product code by double clicking on it since it is the appropriate product To select a product click on option list icon in the Product Code field A list of the products that you have maintained in the branch will be displayed Click on the product which you would like to offer the counterparty When you select a product the transaction acquires the attributes that you defined for the product Contract Reference Number All contracts that are entered into the system are assigned a unique identification number known as the Contract Reference number The reference number for a contract is based on the Branch Code the Product Code the date on which the contract is entered in the Julian
182. ions involved in Foreign Exchange Swap transactions consisting of the simultaneous purchase and sale of currencies with different value dates to confirm the transaction This message can be used to confirm details of a e New contract e Amendment of a previously agreed contract e Cancellation of foreign exchange swaps e Maturity for a foreign exchange swap ORACLE The message provides the following information Sequence A General details of the contract Transaction reference number M Related Reference M will contain NEW in the case of new contract and in the case of Amend the reference of the contract being amended Code Common Reference M NEW AMEND CANCEL MATURITY Date Contract Agreed Amended M Deal Date Currency Code Traded Amount M Currency Code and amount of the Deal currency Swap Points M sub field P or D to indicate premium or discount followed by the swap points In Oracle FLEXCUBE the Swap points would be the rate in the Final Leg less the rate in First Leg Reference Rate M Agreed basis rate for the contract In Oracle FLEXCUBE this would be the exchange rate for the first leg of the SWAP Sender To Receiver Information O Sequence B First Settlement Value Date Currency Code and Amount Bought from the point of View of sender in the first leg of the contract Intermediary Account with Institution Value Date Currency Code and Amount Sold Sender s Correspondent
183. ive of whether they are bought or sold will be netted If you choose to net contracts currency wise the system selects all contracts that have been specified for currency wise netting for the counterparty The value date of the bought currency leg and that of the sold currency leg are considered individually to arrive at the netting date Netting Customer The FX netting customer of the contract s counterparty will be displayed here This would be defaulted from the FX Netting Customer which you have specified for the Counterparty in Customer Information maintenance for the Counterparty A reference is made to the Customer Maintenance while entering a new contract or amending an existing one For every customer FX contracts are collated based on the FX Netting Customer during the Netting Process Automatic and Manual Netting Status The status of netting is displayed in this field Depending on whether the netting type is currency wise or currency pair wise the status will be displayed as any of the following e Not Netted e Bought Leg Netted e Sold Leg Netted e Fully Netted Mode of Netting Mode of netting is defaulted from the netting agreement maintenance of the FX Netting customer You cannot override the value of this field for the specific contract But by changing the value of Netting Type Mode of Netting will undergo certain alterations If you choose Currency Wise or Pair wise netting as the Netting Type a re
184. joining arrow button The screen is given below Foreign Exchange Payment Summary Authorization Status Contract Status Reference Number User Reference Number Buy Sell Liquidate Cancel Bought Currency Sold Currency Outstanding Amount Search Asverces esr Rest Records per page a a E Authorization Status Contract Status Reference Number User Reference Number Event Sequence Number Buy Sell Liquidate Cancel Bot Authorization Status Contract Status Buy Sell A Authorised A Active B Buy U Unauthorised V Reversed S Sell L Liquidated K Cancelled You can click Search button to view all the pending functions However you can to filter your search based on any of the following criteria Authorization Status Select the authorization status of the contract from the drop down list Reference Number Select the reference number from the option list Buy Sell Indicate whether buy or sell from the drop down list ic ORACLE Bought Currency Select the bought currency from the option list Outstanding Amount The outstanding amount maintained is displayed here User Reference Number Select the user reference number from the option list Contract Status Select the status of the contract for which you want to check the pending function from the drop down list Liquidate Cancel Indicate whether liquidate or cancel from the drop down list Sold Currency
185. ker Reference Number Broker Reference Date Broker Remarks Counterparty Confirmation Counterparty Reference Number Counterparty Reference Date Counterparty Remarks E Contract Confirmation Web Page Dialog CHOFXFI001850012 User Reference Number MARKT Broker Code GBP Amount USD Value Date E E The following details are displayed captured here Contract Reference Number This is defaulted from the contract online screen User Reference Number This is defaulted from the contract online screen Counter Party This is defaulted from the contract online screen Broker Code This is defaulted from the contract online screen Bought Currency This is defaulted from the contract online screen 6 54 CHOFXFI001850012 2000 07 07 ORACLE Sold Currency This is defaulted from the contract online screen Amount This is defaulted from the contract online screen Value Date This is defaulted from the contract online screen 6 8 18 1 Capturing Broker Confirmation Broker Reference Number Specify the broker reference number here Broker Reference Date By default the field takes up the Maturity Date of the old deal But for a deal with a fixed maturity date you can enter the changed date on which the deal should be liquidated Broker Remarks Enter the counterparty remarks about the contract 6 8 18 2 Capturing Counterparty Confirmation Counterparty Reference Number Specify the Cou
186. l contracts that are due to be rolled over between this date and the date specified in the next field To Date will be included in the report The system defaults to today s date To Date Enter the date up to which the report is to be generated All contracts that are due to be rolled over between this date and the date specified in the previous field From Date will be included in the report The system defaults to today s date This date should be later than or the same as the From Date specified in the previous field Click OK button to generate the report Click Exit button if you do not want to generate it al ORACLE 12 10 1 Contents of the FX Contracts to be Rolled Over Report The following details of contracts due to be rolled over in the selected period are displayed Serial No The serial number of the contract to be rolled over Reference No The Reference number of the contract to be rolled over Rollover Date The date on which the contract is due to be rolled over Auto Manual The mode of rollover it could be auto or manual New Maturity Date The settlement date of the new contract 12 11 FX Daily Exception Report Automatic Processing Every beginning and End of Day certain automated processes are performed to liquidate contracts perform rollovers etc If an automated activity was not performed it will be reported in the Exception Report along with the reason for which t
187. ld Click on OK button to generate the report Click Exit if you do not want to generate it 12 4 1 Contents of FX Disposition Report The period you have selected through the Report Options screen will be given at the beginning of the report For each counterparty the following details of contracts maturing on a specific date will be reported Contract The Reference number of the contract Reference No Buy or Sell Indicates the type of product Deal Currency The S W I F T Code of the deal currency Deal Amount The amount involved in the contract in the deal currency LCY Rate The local currency rate between the deal currency and the local currency specified in the Contract Details table LCY Amount The local currency equivalent of the deal amount calculated using the LCY Rate For contracts maturing on a particular date the following totals are reported Net Maturity Position This is the total buy or sell position of the currency Example The details of some contracts maturing on 01 02 96 are given in the report as follows LCY AUD Contract Reference No 101FW1194001001 Buy or Sell Type S Sell Deal Currency USD Deal Amount 125730 00 LCY Rate 2 00 LCY Amount 251460 00 a ORACLE Contract Reference No 101FW1194001002 Buy or Sell Type S Sell Deal Currency USD Deal Amount 125730 00 LCY Rate 2 00 LCY Amo
188. le if the FX Spot is a Buy deal then the Placement Interest Rate will be provided Using this the interest amount of the MM Placement which is also the Sell Amount of the FX Interest Forward will be computed The interest amount of the MM borrow and the buy amount of the FX interest forward is the maturity amount maturity amount of the MM placement forward exchange rate original borrow amount sell amount of the FX spot The interest rate for the MM borrow deal can be calculated by using the interest amount and the day count fraction of the deal currency For a Buy Internal Swap Transaction Interest amount of MM borrow Contract Maturity amount of Placement Fwd exchange rate MM borrow amount Interest Rate of the MM borrow Interest amount of MM borrow Contract MM borrow amount Day count For a Sell Internal Swap transaction Interest amount of MM placement Contract Maturity amount of borrow Fwd exchange rate MM Placement amount Interest Rate of the MM Placement Interest amount of MM placement MM placement amount Day count The exchange rate of the FX interest forward contract will be derived based on the buy sell amounts om ORACLE If the interest rate calculated for the MM placement borrow contracts does not lie between the minimum and maximum rates defined for the contract currency in the MM product they will be updated to null at the contract level After the contracts are uploaded th
189. lity INR 5 000 000 oe ORACLE Account Balances as on 1 1 09 USD Nostro INR Nostro USD Fwd Bought USD 100 000 INR Fwd Sold Accounting Entries on 31 1 09 Spot Rate is USD 1 INR 52 00 Dr USD Nostro 2 INR 200 000 Cr Exchange P LINR 200 000 NIL NIL INR 5 000 000 INR 5 000 000 Current accrual 31 days 100 000 31 45 INR 68 889 Future Accrual 14 days 100 000 14 45 INR 31 111 Dr Exchange P L Cr P L Interest amp Exchange a c Cr Account Balances as on 31 1 09 Exchange P L P L Interest amp Exchange a c USD Accounting Entries on 15 2 09 Reversal of contingent entries INR 100 000 INR 68 889 INR 31 111 INR 100 000 Cr INR 68 889 Cr INR 168 889 Dr Dr Fwd Sold INR INR 5 000 000 Cr Fwd Bought USD 100 000 INR 5 000 000 Settlement Entries Dr USD Nostro USD 100 000 INR 5 000 000 Cr INR Nostro INR 5 000 000 Account Balances on 15 2 09 USD Nostro USD 100 000 INR Nostro Int amp Exch P L a c INR 5 000 000 Dr INR 5 000 000 Cr INR 68 889 Cr 4 9 ORACLE USD INR 168 889 Dr Exchange P L INR 100 000 Cr Accounting Entries Revaluation Rate USD 1 INR 53 00 Cr INR 168 889 Dr Exchange P L INR 168 889 Dr USD Nostro INR 300 000 Cr Exchange P L INR 300 000 Accrual Dr Exchange P L INR 31 111 Cr Int amp Exch P L INR 31 111 Account Balances as on 28 2 09 USD Nostro 1 USD 100 000 INR 5 300 000 Dr INR Nostro 1 INR 5 000 000 Cr Exch P L INR 200 000 Cr Int
190. lleged Amount Specify the amount of the deal Based on the search criteria the system displays the following information in this browser e CLS Currency Currency of the CLS deal e Value date The maturity date of the deal e Net Matched Amount The Net Position for all deals with Matched status e Net Unmatched Amount This will include all deals with Rescind Unmatched Failed and Mismatched status e Net Settlement Amount The sum of net matched and net unmatched amounts e Net Alleged Amount The Net position for all deals with alleged status e Net Settled Amount The Settled Amount for all deals with status as Settled e Funding Cut off date The funding cut off date for the deal currency e Funding Cut off Time The funding cut off time for the deal currency If you double click on a specific record in the browser the CLS Status Browser will display the details of the Net Position for the selected currency Bought or Sold whichever is selected and value date combination Pay in and Pay out with the Settlement Member The net pay in and pay out will be communicated via the following media 8 1 6 1 Web Based settlement The Settlement Member may use the Web Based Service to communicate the information to the Third Party The CLS Interface will be used to upload the information into Oracle FLEXCUBE The SWIFT MT970 Netting Statement MT971 Netting Balance Report will be suppresse
191. llover Bought value date Branch date the tenor will be calculated from the rollover date Oracle FLEXCUBE will carry out the following validations while saving a Contract Ensure that Credit lines are different for each limit tracking Checks for the existence of risk category in the Customer maintenance if risk weighted limit tracking is set at the contract level Checks for the existence of risk percent maintenance for risk category FX ALL product combination if risk weighted limit tracking is set at the contract level Checks for the presence of credit lines if risk tracking options are set at the contract level Displays an error message if pre settlement risk option credit line is maintained and if the product is not set for revaluation Displays an error message if limits tracking required is N and risk tracking options are Y al ORACLE 6 2 4 1 Non Deliverable Forward Details A Non Deliverable Forward NDF is an outright forward or futures contract in which counterparties settle the difference between the contracted NDF price or rate and the prevailing spot price or rate on an agreed notional amount The NDF s have a fixing date and a settlement date The fixing date is the date at which the difference between the prevailing market exchange rate and the agreed upon exchange rate is calculated The settlement date is the date by which the payment of the difference is due to the party receiving
192. ls for the contract Please refer to the Settlements User Manual for details Operations on a Contract You can perform the following operations on a deal that is saved Amend Copy View different versions of a deal Delete Reverse Put a deal on hold Roll over Liquidate Reassign Authorize Choose the operation you want to perform by one of the following methods Click on the respective operation in the Toolbar Select the operation from the Action Menu Choose the operation when the contract is highlighted in the Contract Summary View screen or when the contract details are displayed in the Contract Detailed View screen Amending deal details Certain values in a contract can be amended after it has been stored and authorized You can also amend a contract that has been input but is yet to be authorized For each amendment a new version of the contract will be generated During Contract Detailed View you can view the different versions by clicking on back arrow button for the previous version and forward arrow button for the next one To amend the details of a contract select Unlock icon in the Application tool bar when you are in the Contract Detailed View for the contract oe ORACLE 6 8 2 You can use the Unlock operation to extend or advance the Value Date of a contract If it is advanced to today s date an error message will be displayed and the date will not be accepted In such a case you
193. m Discount i 7 j ENI Ti 7 Events Option Brokerage Change Log Settlement Advices Messages Charges Tax MIS Fields All Messages Input By Date Time Authorized By Date Time Contract Status DOC3 Cancel Roll over instructions for forward contracts can be input only through the Unlock operation You cannot input them when you are entering the contract details through the New or Copy operation Auto Rollover While setting up a product you should specify whether contracts involving the product should be rolled over on the maturity date If rollover is applicable you can specify in this field whether contracts involving this product should be rolled over automatically or manually If you want the contract to be automatically rolled over click on the check box against this field The contract will be automatically rolled over on its Value Date settlement date If you do not click on the check box you should manually roll over the contract To manually roll over a contract enter the date on which the contract should be rolled over in the Rollover Date field vee ORACLE Rollover Required In this field you can specify whether rollover is required or not for contracts involving this product If check this box rollover is allowed for contracts involving this product During contract processing you can specify whether such contracts should be automatically or manually rolled over If you do
194. mber Alphanumeric Number or the Reference Number of the Treasury System Their Yes 20 Counterparty Settlement Member Reference Reference No Alphanumeric Number 8 12 ORACLE Element Id Mandatory Size format Description Common Yes 16 Common Reference Number Reference No Alphanumeric Value date Yes MM DD YYYY The maturity date of the deal Bought Ccy Yes 3 The buy currency of the deal Alphanumeric Bought Yes 14 Numeric The buy amount in the buy currency Amount Sold Ccy Yes 3 The sell currency of the deal Alphanumeric Sold Amount Yes 14 Numeric The sell amount in the sell currency Exchange Rate Yes 16 Numeric Deal Exchange Rate 8 1 7 3 Settlement Status Update The CLS settlement status will be updated in the CLS Status Browser by means of an upload If the deal is missing in Oracle FLEXCUBE the record will be inserted in the CLS Status Browser with the following statuses e CLS status Alleged and e Resolution Status Pending 8 13 ORACLE 9 1 9 2 9 FX Advices and Messages Introduction When you create a product you can specify the advices that you would like to generate for the various events that occur during the life cycle of a contract You can also specify when the advices should be generated either during the event or during authorization of the event Events are classified as follows e User initiated events e Automati
195. mbinations 0 cecccecccseeesteesseeeeeeceseceecesecaecasecaeecaeeeseesaeesseeseeensesseenaeenaeeaes 4 22 43 2 Creating a Product COMBINATION ccccescete esnias e E o E EE EARE 4 22 4 3 3 Maintaining Product Category Details for Internal Swap Transactions 4 24 5 BEGINNING OF DAY OPERATIONS essessseeseseseeceresoeseseeceeerosoesesesoeeosoroesesoecesororoeseseeoerororseseseecesosoeseseeeee 5 1 5 1 INTRODUCTION P E E E 5 1 5 1 1 Forward Rates oceneni E A EE E EE EE 5 1 51 2 DISCOUNTING Rotes simeso a a e a E i Ea aR e ER R 5 1 5 2 AUTOMATIC LIQUIDATION OF A CONTRACT cccsssssssecececsesseaececececeessaeeecececsensseeecececseneuaaeeeeeceeeeneaaeeeeees 5 2 5 2 1 A description Of the func honraria i e e E E E E OEE E 5 3 ORACLE 5 3 AUTOMATIC ROLLOVER OF A CONTRACT cccccccececececececececesecececececscececececesesececacacacececesecesscaseceseesseuseeeaeaeaes 5 4 5 3 1 A Description of the Function Procedures ccccccccccesscesscesecesecusecusecasecseeeseeeseeeeeeseeseeeeeenseeeaeenseeaae 5 5 3 3 2 Retrieving InfOrmationnn ccccccccccesccesssecessceessecesceeessecesseeescecseceeeaseceneecsaecseaeecsaecseaeecaeceeaeecaeceeaeecnaeeesaes 5 5 6 CONTRACT PROCESSING cccsssssecscsessssssscesessssscssenssessnesecsnsssesessssesssenesscssessossessnssessnessssscsseseessoeses 6 1 6 1 INTRODUCTION jis tescei isd stbacia eee abschacstieons EENE esti EEEE EE KEETE AEEA EENET REAT 6 1 6 2 ENTERING ANTEX DEAG scontano etne
196. mer FX to FT This report gives netting details of Foreign Exchange contracts that were settled by generating FTs The report gives the netting details for a specified customer and date You can generate this report any number of times during the day You can generate this report for e A specific date or a date range e A specified customer a list of customers or all customers The date for which the report is generated is given The details in the report will be under two categories The master part will contain the following information e FT Contract Reference Number e Currency e Amount e The Debit or Credit indicator with respect to customer e Value Date as ORACLE e FT upload status e Netting Type The details part of the report will contain the following information e FX Contract Reference number e FX Contract Status e Amount e Debit or Credit indicator debit for Bought and Credit for sold Netting Status of the contract 12 17 Netting report by Maturity Date and Customer FT to FX This report gives netting details of Funds Transfers that were triggered by Foreign Exchange contracts The report gives the netting details for a specified customer and date You can generate this report any number of times during the day You can generate this report for e A specific date or a date range e A specified customer a list of customers or all customers The date for which the report is generated is displayed in the
197. n be captured through four different screens please refer the chapter on Settlements Through these four screens you can capture the following information e Account details details about the accounts that have to be either debited or credited in your branch e Party details details about the various parties involved in the deal e Information required to be sent as part of messaging ee ORACLE 2 1 7 Retrieving Information Relating to FX deals During the day or at the end of the day you may want to retrieve information relating to foreign exchange deals This information can be generated in the form of reports A report is information retrieved mostly in a printed format However you can direct a report to one of the following destinations e The printer e The screen as a display e A spool file stored as a spool file to be printed later The reports that you have spooled can be printed or viewed through the Reports Browser screen The following are the reports that you can generate in the foreign exchange module e FX Contract Event History View report e FX Currency Analysis report e FX Maturity Analysis report e FX Tenor wise Currency Position report e Unconfirmed FX Contracts report e FX Contract Daily Movement report e FX Contracts to Rollover report e Discount Rate report e FX Product Combination report e FX Contract Overrides report e FX Brokerage details report e FX Rollover due report
198. n list displays all valid currency codes maintained in the system You can choose the appropriate one If you want to generate the report for all currency pairs select the option ALL To Currency Pair Specify the currency pair for which the forward rates report needs to be generated The adjoining option list displays all valid currency codes maintained in the system You can choose the appropriate one If you want to generate the report for all currency pairs select the option ALL Click OK button to generate the report Click Exit if you do not want to generate it 12 2 1 Contents of the Currency Forward Rates Report Header The Header carries the title of the report information on the branch code branch date the ID of the user who generated the report the date and time at which it was generated and the modules covered in the report Body of the report The following details will be reported for currency pairs Currency 1 The first currency code Currency 2 The currency code forming the currency pair with Currency 1 Mid Rate The exchange rate used for conversion Period Code The period code for report generation Premium Discount Points Premium discount points for the currency pair ae ORACLE 12 3FX Currency Analysis Report This report gives the net currency position due to contracts maturing within a specified period You have to specify the period and currency in the
199. nanced and sum of the limits of all the users involved in authorizing a transaction this case holds good when the Cumulative field is checked in the Product Transaction Limits Maintenance screen e the transaction amount is greater than the authoriser s authorisation limit if the Cumulative field is unchecked in the Product Transaction Limits Maintenance screen one ORACLE 6 8 12 Authorizing Bulk FX contracts Typically FX contracts must be authorized in the respective Contract Online screens This method of authorizing the contracts can be quite cumbersome especially if the volume of transactions is large In view of that Oracle FLEXCUBE allows bulk authorization of all unauthorized FX contracts from the Unauthorized Contracts screen Invoke this screen from the Application Browser 74 Bulk Authorization Detailed Web Page Dialog Module z IT Ignore Overrides TO Generate Messages Fetch Unauthorised Contracts a O Contract Ref Number User Ref Number Counterparty Name Short Name Product Amountt Currency Amount2 Curr E E Contract Details O Amount Tag Tag Currency Branch Account Pay Recy Intermediary Reimbursement Institution Receiver Correspondent Inte E _________ s s_______ L Ri m Ee elm l u k Authorize View Error In the Unauthorized Contracts screen you can indicate the following parameters Module Specify the module LD
200. not check this box rollover is not allowed for contracts involving this product If you have selected Yes in the Auto Liquidation field the Rollover Allowed field should be set to No In other words if contracts involving this product are to be automatically liquidated on the maturity date these contracts cannot be automatically rolled over Sold Amount This is the Sold amount of the new contract The Sold amount of the old contract will default here if the Deal Type is Sell Sold Value Date This is the settlement date of the Sell contract as specified in the Contract Details table If Split Value Dates are allowed for the contract the Bought and Sold legs of the contract can have different settlement dates Bought Amount This is the Bought Amount of the new contract The Bought Amount of the original contract defaults here if the Deal Type is Buy Bought Value Date This is the settlement date of the new contract Enter a date that is later than the Value Date of the original contract For forward contracts enter a date that is later than the Spot Date of the currency If an Option Date is allowed for the product involving the contract enter a date that is later than the Transaction Date and earlier than the Value Date of the contract Rollover Exchange Rate The Exchange Rate between the currency pair involved in the contract is displayed here You can change the Exchange Rate that is displayed here Since the rate th
201. ns are satisfied MT 304 will be generated in addition to MT 300 FX Confirmation Message Depending upon the operation performed whether you have captured a new deal amended an existing deal or cancelled a deal one of the following MT304 Message Types will be generated e FS _FMCONF_NEW For a new deal e FS _FMCONF_AMND When a deal is amended e FS _FMCONF_CANC On cancellation of a deal If you have not maintained a primary address for the counterparty the message will be put into repair The following table lists the fields that are different between MT300 and MT304 It also identifies the fields that are mandatory for MT304 Fields MT300 MT304 MT304 Value 94A Optional AGNT BILA BROK Mandatory ASET Codes ASET AFWD 83 Optional Mandatory 83A lt Sender BIC gt 87 82 Mandatory if 94A exists Mandatory Same as MT300 24D lt Confirmation Info gt Field not allowed 88A Optional Broker Id Field not allowed 72 lt Same as 24D 88A BROKER PHON TELEX ELEC Codes of MT300 gt 22C Mandatory Field not allowed 53 Optional Ne as Delivery Same as field 57 of Sold Side gent The Receiver of MT304 will be the BIC of the Settlement Member defined for your branch which is a CLS participant of the Third Party type MT304 will be always sent to this Settlement Member MT300 will always be sent to your counterparty The processing workflow is explained in the
202. nt If the Buy Sell indicator is Sell and the Spot Rate is modified the Buy Amount will be recalculated keeping the Sell Amount constant If the Buy Sell indicator is Sell and the Buy Amount is modified the Spot Rate will be recalculated keeping the Sell Amount constant The User Reference number will be defaulted to the Deal Reference Number and will be unique across all internal swap transactions You can close the swap deal This will reverse the linked FX MM deals on authorization ae ORACLE 6 14 2 Processing Internal Swap Transactions The FX Spot Contract created will be a cash deal settling on the Spot Value Date itself All the transactions will have the internal swap customer as the counterparty and the settlement instructions will be defaulted based on that The day count fraction for finding out the interest amount and the interest rate for the corresponding MM transactions will be derived from the currency of the respective MM contracts The interest rate type will be fixed for MM contracts If the Spot FX transaction is a Buy then the other two Forwards will be Sells If the Spot FX transaction is a Sell then the other two Forwards will be Buys MM placement transaction will have the deal currency as the Buy currency of the Spot FX Deal MM Borrow Transaction will have the deal currency as the Sell currency of the Spot FX deal The FX Interest Forward will be based on the interest amounts of the two MM deals For examp
203. nt rates are maintained daily or monthly That is they are maintained as often as you revalue foreign exchange contracts using the Rebate method To liquidate and rollover contracts marked for automatic liquidation and rollover you must invoke the respective procedures from the Application Browser 5 1 1 Forward Rates When you revalue a forward FX contract using the rebate method you will use an exchange rate for the currencies involved referred to as a Forward rate The forward rate for a currency for a specific period is computed using the spot rate and the prevailing interest rate The forward exchange rates for currency pairs are maintained in the FX Forward Rate Maintenance screen These forward rates will be used when contracts in different currencies are revalued using the Rebate Revaluation method The procedure to maintain forward rates is explained in the FX Module Specific Tables Maintenance chapter 5 1 2 Discounting Rates Discount rates are used to compute the net present value of an outstanding FX contract The discounting rate for a currency is maintained in the FX Discounting Rate Maintenance screen These discounting rates will be used when contracts in different currencies are revalued using the Rebate with NPV method of Revaluation You can maintain discounting rates for a currency for different tenors os ORACLE 5 2 The procedure to maintain discounting rates is explained in the FX Mo
204. nterparty Reference Number in this field Counterparty Reference Date This is the Date on which the contract is confirmed by the counterparty It should be later than the Transaction Start Date and before the Value Date The system defaults to the current date Counterparty Remarks Enter the counterparty remarks about the contract Select Yes button to save the confirmation After the confirmation has been registered you will be returned to the screen from where you invoked this screen Please note that a confirmation does not need authorization No advice will be generated for a confirmation Click on No button if you do not want to register the confirmation You will be returned to the FX Contract Detailed View screen ony ORACLE 6 8 19 Liquidating a contract manually An authorized contract can be liquidated manually Please note that a contract need not necessarily be defined with manual liquidation for you to liquidate it manually Even if the contract is defined for automatic liquidation you can liquidate it through this option on a day earlier than the Value Date of the contract You can invoke the Manual Contract Liquidation screen from one of the following functions e Contract Summary View e Contract Detailed View In the Contract Summary View screen select Liquidate from the Processing sub menu when the contract is highlighted or in the Contract Detailed View select Liquidate
205. ntract authorization Errors in Authorization Web Page Dialog authorised Errors O Contract Ref Number Error Messages wik 6 8 15 Viewing the Settlement Details The settlement account details of each contract will be displayed in the Settlement Instructions screen Click on the contract for which you want to view the settlement details and it will be displayed in the Settlement Instructions section For each amount tag the following settlement details are displayed Settlement account Currency of the settlement account Settlement account branch Ta ORACLE e Payable or Receivable e Ordering Institution e Ordering Customer e Beneficiary Institution e Ultimate Beneficiary The settlement details for the latest event of the contract will be displayed 6 8 16 Viewing the Details of the Contract The details of the unauthorized contracts can be viewed by double clicking on the contract reference number in this screen In case of FX contracts the screen that is displayed on double clicking a contract depends on the stage of the contract that is unauthorized e f booking initiation or contract amendment is not authorized the Contract Online screen is displayed e If a payment of a contract is unauthorized the Payment screen is displayed e Ifa value dated amendment is unauthorized the Value Dated Amendment screen is displayed The FX
206. nts cancellations and rollover are not allowed for products with Discounted Straight Line method of revaluation Contract Amount in Local Currency The local currency equivalent of the contract amount as specified in the LCY Equivalent field of the Contract Details screen is displayed here 6 2 11 Saving the Contract You Entered You should give valid inputs in all the mandatory fields If not you cannot save the contract After you have finished giving all your inputs save the contract using one of the following methods e Click on save icon in the Toolbar or e Select Save icon 6 2 12 Processing a Contract Involving a Product Combination If the product code input by you is that for a product combination the input screen defined for the first leg will be displayed After you finish your inputs for the first leg choose L button to input the details of the next leg of the contract All the validations that are applicable for the first leg of the contract will be performed before the input screen for the next leg is displayed The product code of the product combination will be displayed You cannot change it Likewise if the product combination is for a swap deal the fields whose values you have defined as Defaults will be displayed You cannot change them After you have given inputs to all the fields necessary save all the legs of the contract using one of the following methods e Click on save icon in t
207. number of days to be considered for including contracts based on the specification given in the previous field For example if you want to include contracts that have not been confirmed even after 15 days of being initiated select Booking Date in the previous field and enter 15 in this field 12 6 1 Contents of the Unconfirmed FX Contracts Report The contents of unconfirmed FX contract report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body You can find the following details in the body of the report bas ORACLE The following details are reported for contracts involving a particular currency Contract Reference The Reference number of the contract No Customer No The Customer ID of the counterparty involved in the contract Customer Name The Short Name of the customer as defined in the Customer Base Record Number of days The number of days after the initiation date of the contract Deal Currency The S W I F T Code of the deal currency Deal CCy Amount The amount involved in the contract in deal currency Value Date The settlement date of the contract The following totals are given e Net Amount in the Deal Currency e LCY Equivalent of the Net Amount 1
208. o e Event Keyword e Contract date e Exchange rate e Value Date e Currency Bought e Amount Bought e Amount Sold e Currency Sold e Value Date Sold Confirmation of deals entered in the Foreign Exchange module of Oracle FLEXCUBE is automated On receipt of an MT 300 FX Confirmation SWIFT message from the counterparty Oracle FLEXCUBE extracts all relevant information from the different fields and the header Oracle FLEXCUBE automatically marks the contract which matches the information extracted from the SWIFT message as confirmed and the message as processed If several contracts match the extracted information the incoming message is marked out automatically for manual confirmation A report furnishes this information and the mismatches that occurred in the day 2 Automatic Confirmation upload of MT30073 iE Auto Confirmation of SWIFT msgs v x To execute the auto confirmation function invoke the Automatic Confirmation Upload screen from the Application Browser oe ORACLE Telex format If the contract is to be netted for settlement instead of the settlement details the text Netted contract standard settlement instructions apply will be printed Tracer The system generates a confirmation tracer when broker confirmation or counterparty confirmation is not received for a contract contract status is unconfirmed in Oracle FLEXCUBE The confirmation tracer advice is generated
209. ode of the foreign exchange dealer in your bank who entered into this deal From a list of dealers available choose the dealer Double click on the ID of the dealer who entered into the deal Note that an entry in this field is not mandatory Reversed Reference Number The reference number of the contract that is being reversed and rebooked is displayed here For further details on reversing and rebooking of a contract refer the section titled Reversing and Rebooking a Contract of this user manual Source This indicates the name of a registered external system in Oracle FLEXCUBE UBS External Reference Number This is the reference number sent from the external system This is a mandatory field during an upload from an external system Bill Reference Number This is the reference number of the bill contract in the BC module 6 2 3 Specifying the Main Tab Details Buy Sell In an Foreign Exchange deal you would either buy or sell currency Indicate if the contract that you are entering is a Buy deal or a Sell deal To indicate that the deal is a buy deal click on the button against Buy You can indicate that a deal is a Sell deal by clicking on the button against it ssi ORACLE Related Reference Number Specify the related reference number for the contracts For an NDF Forward Contract this field indicates the reference number of the corresponding NDF Fixing Contract For an NDF Fixing Contract it indicates the NDF
210. ooking Netting Mode While specifying netting details for a customer you should indicate how you wish to initiate the process of netting You can choose between the following two options as the mode of netting e Automatic If you choose to automate the netting process netting is done automatically for the specified customer e Manual If you choose Manual you have to manually initiate the netting process for the customer through the Manual Netting screen FXDMANNT Netting Date Currency For every currency you can maintain a list of holidays This list is maintained in the Core Entities module The holiday list for a currency is used to compute the netting date for contracts The holiday list of the currency that you specify in this field will be used to compute the netting date for contracts involving the customer Example You have specified 4 Jul 08 as a holiday for USD in the Holiday List maintained for the currency For a customer you have indicated the netting days as 2 in the Netting Days field and have specified USD as the Netting Date Currency If contracts are due for settlement on 5 Jul 08 for example they will be netted two working days before 5 Jul 08 That is on 2 Jul 08 since 4 Jul 08 is a holiday S You cannot settle a contract on a holiday specified for the currency In the Currency field you can invoke a list of the currencies that you have maintained in your bank Double click on the c
211. ought legs of FX contracts which have risk netting feature set for any of the 3 risks The following details will be stored in net inflow outflow details e Branch e Customer e value date e currency e currency pair e Netted reference number e Netted amount for settlement risk e Netted amount for pre settlement risk e Netted amount for weighted risk When the FX contract which forms part of netting bucket is input the following will be done e The system will check if the netted limits tracking options are set for the contract If it is not set then the system will not do netted limit tracking e f either of the netted limit tracking options is set then the system will check the netting type e Depending on the netting type the system will check if any net inflow outflow details are stored for the customer branch currency value date combination or customer branch currency value date currency pair combination This will be checked for both the sold and bought legs eee ORACLE If no match is found then the system will insert the inflow outflow details for both bought and sold legs During insertion of buy leg the system will calculate net settlement amount as bought currency amount and net weighted risk amount will be computed using risk percent on bought amount During insertion of sell leg the system will calculate net settlement amount as sold currency amount and net weighted risk amount will be computed using risk percen
212. ount points for the currency pair specified subsequently would be added to or deducted from the spot rate displayed Period Code You can maintain forward rates for specific tenors in days These tenors are referred to as Periods Example The following are examples of tenors e 30 days e 60 days e 90 days etc For each currency pair you can maintain forward rates for different periods In the Period Code column you can enter the period codes for which you want to define forward rates ae ORACLE Points The forward rates for a currency pair should be maintained in the form of premium or discount points vis a vis the spot rate for the currency pair In the Points column you must specify the forward rate for the period that you specified in the previous column for the currency pair Example The local currency at Royal Services Bank Ltd is EURO EUR The bank deals with Great Britain Pound GBP US Dollars USD and Australian Dollars AUD The Spot Rate between USD and EUR is 1 3 where 1 USD 1 3 EUR Against this Spot Rate the forward rates should be as follows Period Exchange Rate 10 days 0 01 30 days 0 02 90 days 0 05 To maintain these rates you should do the following e Enter USD as the CCY e Enter a Base Date e Enter the Spot Rate between EUR and USD as 1 3 e Inthe Period and Exchange Rate columns enter the information exactly as in the Table For all contracts with a Maturity
213. owing dates for the spot rate prevalent on that day Schedule Dates Spot rates for GBP to Euro conversion Spot rates for USD to Euro conversion 31st Jan 2009 31 days 1 02 1 01 1 04 1 02 28th Feb 2009 28 days On the Booking Date i January the system will pass the following contingent entries Dr Cont Discounted bought amount gt GBP 48 000 Though the LCY Equiv 48 048 it will be passed as 50 100 the LCY equivalent of the non deal currency Cr Cont Discounted sell amount gt USD 50 000 LCY Equiv 50 100 Assuming that the spot rate is 1 001 between EUR GBP and 1 002 between EUR USD Since we are processing a buy deal the LCY equivalent of this contract is the LCY equivalent of the sold leg non deal currency i e 51 000 1 002 EUR 51 102 Similarly LCY equivalent of the discounted amount is 50 000 1 002 EUR 50 100 The forward interests of 2000 on GBP and 1000 on USD are accrued at the end of each month on the schedule dates During revaluation the LCY equivalent of the discounted deal amounts as of the booking date is converted to the current new rate and the difference is booked as gain loss Gain Loss for GBP Date Amount after revaluations Gain Loss 31 Jan 48 000 1 02 48 960 48 960 48 000 960 28 Feb 48 000 1 04 49 920 49 920 48 960 960 Total Gain Loss 960 960 1920 EUR 4 13
214. pdating of Limit Tracking options The limits tracking options will be defaulted from the limits netting agreement maintenance applicable for the counterparty You can modify the limits tracking options during FX contract input The process for defaulting from the limits netting agreement is as follows e The system will check if the limit netting agreement exists for the counterparty of FX contract If the agreement exists then the risk tracking options will be defaulted to the contract from limits netting agreement e If the limit netting agreement does not exist for the counterparty then the system will check if the counterparty is part of FX netting group customer from customer maintenance e If the netting group customer is not maintained for the counterparty then all the risk tracking options will be unchecked at contract level e If the netting group customer exists then the system will check if the limit netting agreement exists for the netting group customer If the agreement exists then all the risk tracking options will be defaulted to FX contract from limits netting agreement ee ORACLE e If the limit netting agreement does not exist for the netting group customer then all the risk tracking options will be unchecked at contract level e The pre settlement risk tracking option will be unchecked at the contract level even though the line is maintained in agreement and revaluation is No at the product level The same cannot b
215. pes You can receive one of the following CLS Statuses from the above media types CLS Status Description Matched 5 Deal is matched in CLS Un matched 4 Deal is un matched in CLS Mismatched 3 A deal is partially matched Rescinded 1 Deals that have been cancelled unilaterally or bi laterally Failed 2 Deals that have failed verification in the CLS Bank Alleged 6 Deals by other parties that do not appear in Oracle FLEXCUBE 8 1 ORACLE 8 1 1 4 Status Resolution Depending upon the status of the deal the same can be amended and re sent to the CLS Bank or cancelled and re booked inside or outside the CLS Scheme From Status To Status Event Action Matched Unmatched Mismatched Rescinded Failed Amendment or Cancellation Un matched Matched Mismatched Rescinded Failed Amendment or Cancellation Mismatched Rescinded Failed Deal Cancellation Rescinded No status change allowed Deal Cancellation Failed No status change allowed Deal Cancellation Note that e Acancelled deal may be rebooked and settled inside or outside the CLS Bank e You cannot amend a mismatched deal in Oracle FLEXCUBE e During EOTI the system will ensure that there are no active deals with status other than Matched or Un matched If deals are active with Rescind Failed or Mismatched status the contract status should be Reversed Fo
216. ploaded to Oracle FLEXCUBE should contain the following tags e U indicating that the record should be updated e D indicating that the record should be deleted e N indicating a new record BIC addresses that have changed will be appropriately updated Addresses bearing the tag D will be automatically deleted New BIC records will be created for records that bear the tag N You can also specify the date as of which data was written into the upload tables of Oracle FLEXCUBE Click Upload button to start the upload of BIC Codes from the selected source After the upload is complete the following details are displayed e The total number of records that were processed and e The number of records that were rejected 7 1 10 Maintaining Settlement Instructions for CLS Deals You can maintain the settlement preferences for a customer in the Settlement Instructions Maintenance screen You can invoke the Settlement Instructions Maintenance screen by typing ISDINSTR in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Settlement Instructions Maintenance a Counterparty laz Module az Counterparty Type v Product Code az Currency GBP azl Sequence Number 0 Branch 000 az Relations Pay Receive Branch 000 az Branch 000 az Cover Required SEE az com la CoverBy v Currency GB
217. pted or transmitted in any form or by any means electronic mechanical photographic graphic optic recording or otherwise translated in any language or computer language without the prior written permission of Oracle Financial Services Software Limited Due care has been taken to make this document and accompanying software package as accurate as possible However Oracle Financial Services Software Limited makes no representation or warranties with respect to the contents hereof and shall not be responsible for any loss or damage caused to the user by the direct or indirect use of this document and the accompanying Software System Furthermore Oracle Financial Services Software Limited reserves the right to alter modify or otherwise change in any manner the content hereof without obligation of Oracle Financial Services Software Limited to notify any person of such revision or changes All company and product names are trademarks of the respective companies with which they are associated
218. py This is applicable if the counterparty is a SWIFT member If you specify that T Copy is required the SWIFT media will send the CLS Confirmation Message MT300 to the counterparty of the deal with a copy to your settlement member If multiple addresses are maintained MT300 will be sent to the location which is marked as the counterparty s primary address If the third party does not subscribe to T copy or if the counterparty is not a SWIFT member Oracle FLEXCUBE will automatically generate the MT304 message and identify the BIC of the Settlement Member where your branch is the Third Party participant as the receiver of the message In such a case MT300 will be a normal confirmation which will be sent to your counterparty if it is a SWIFT subscriber If you check T Copy the system will include the TPS identifier in MT300 message for CLS NDF deals However the system will not generate MT304 message for the message type FS_FMCONF Auto Confirm CLS Deals You may select this option to enable the system to automatically confirm the CLS deals processed at your branch In this case the system will ignore the MT300 received from the counterparty and mark the confirmation status as Confirmed 7 3 ORACLE For details on the other generic preferences refer the Maintaining Data Specific to the FX Module chapter of this User Manual 7 1 2 Allowing a Currency to be Settled Inside CLS When setting up currency details
219. py icon The following changes will be done to the details copied e Anew Reference Number will be allotted to the contract e The User Reference field will be left blank e The Transaction Date will be given a value of today and the Value Date will be left blank e The Amount fields will be left blank e The brokerage tax and settlement instructions will be copied These details will be validated afresh before the contract is stored 6 8 5 6 8 6 Enter a value in the fields that are not copied You can change the values in the fields that have been copied When a contract on Hold is copied and the new contract saved the Hold on the contract will be released Thus to release a contract from Hold you should copy it onto a new contract In such a case All the details will be copied including the Reference Number the User Reference the Transaction Date Value Date and the amounts If the contract from which you copied details involved a product combination the details of both the legs will be copied Viewing different versions of the contract When a contract is input it is allotted a version number of 1 From then on each amendment results in the next version of the contract being created When you come to the Detailed View Screen for a contract the latest version will be displayed Click on back arrow button to see the previous version Click on forward arrow button from a previous version to see the next version
220. r O Single 12 22 1 Contents of the Report The contents of contract maturity due reports have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body You can find the following details in the body of the report Mat Date The date on which the contract gets matured Contract Ref The identification number of the contract No Customer The name of the customer Name Counter Party The counter party involved in the contract Sd Currency The sold currency of the contract Bt Currency The bought currency of the contract ae ORACLE Mat Date The date on which the contract gets matured Sold Amount The amount for which the currency is sold Bought The amount for which the currency is bought Amount Eur Eq Amt The euro equivalent amount 12 23 Fund Transfer to Foreign Exchange Netting Report This report provides information on fund transfer to foreign exchange netting To invoke the screen type FXRPNTFT in the field at the top right corner of the Application tool bar and click the adjoining arrow button Funds Transfer to Foreign Exchange Netting Report Type By Value Date By Netting Date By Funds Transfer Reference Number
221. r Revaluation gain unrealized 21 01 Dr Revaluation gain unrealized 5 25 Cr Interest payable sold currency 5 25 Therefore you will earn a profit of 21 01 on the bought currency GBP and incur a loss of 5 25 on the sold currency as per the revaluation of the previous accruals The profit loss may fluctuate during each revaluation The status is reflected on a daily basis On liquidation day revaluation the P amp L is reflected as per the rate on that day On liquidation everything is realized implicitly because the accrual reversal from unrealized to realized is done at the prevailing rates IA ORACLE Reversal of the unrealized revaluation the sum of the revaluation gain for both the schedule dates on the maturity date For GBP Dr Unrealized revaluation gain 1920 Cr Discounted bought amount 1920 For USD Dr Discounted sold amount 1000 Cr Unrealized revaluation gain 1000 This is also done as part of the account level revaluation In Oracle FLEXCUBE the account level revaluation run as part of the End of Day operations takes care of the Nostro revaluation reversal of the unrealized revaluation and revaluation of interest discount accrued You can indicate the method of revaluation by clicking on the button against the respective methods Revaluation method for Spot Contracts None of the above mentioned revaluation methods are available
222. r Fund Transter Fields Input By DOCS Date Time Modification Number BB suthorizea eB Cancel Authorized By Date Time open Customer Number You must indicate the customer for whom you are maintaining netting details The adjoining option list displays a list of all the customers maintained in the system You can choose the appropriate one When you choose to net contracts at the beginning of the day all contracts specified for netting will be netted for every customer for whom you have maintained netting details Netting Type You can net the contracts involving a customer in two different ways Contracts can be either be netted e Pair wise Netting The FX contracts that you enter into involve currency pairs For example a deal where USD 10 000 is bought against EUR 15 000 involves a currency pair When you choose to net contracts pair wise the system selects all contracts that have been specified for Pair wise Netting counterparty wise Contracts that have the same currency pair irrespective of whether they are bought or sold will be netted Only those contracts that ma ORACLE e Have not already been netted and which e Do not belong to the status both bought and sold netted will be netted Example Assume you have entered into the following contracts with Cavillieri and Barrett Finance Corporation which are due for settlement on the same day e Three USD INR contracts both buy and sell deals e On
223. r alleged trades deals by other parties that do not appear in Oracle FLEXCUBE the status resolution will be as shown in the table below From Status To Status Event Action Pending Closed The deal will be booked in Oracle FLEXCUBE and the Reference Number linked to the alleged trades in the Status Browser Closed Status change not allowed 8 2 ORACLE 8 1 1 5 CLS Interface The CLS Interface will interface with the web based service of the Settlement Member The following format may be used for the interface with the Settlement Member Only web based statuses will be processed by the Interface The upload format will be as follows Element ID Mandatory Size Format Description CLS Status Yes 1 Alphanumeric CLS Deal Status received from web service The values should correspond to the Deal Statuses mentioned above Counterparty No 10 Alphanumeric Counterparty of the deal Our Reference Number No 20 Alphanumeric This can be Oracle FLEXCUBE Reference Number or the Reference Number of the Treasury System Their Reference Number No 20 Alphanumeric Reference Number of the counterparty Common Reference No Yes 16 Alphanumeric Common Reference Number Value Date Yes MM DD YYYY The maturity date of the deal Bought Currency Yes 03 Alphanumeric The buy currency of the deal Bought Amount Yes 14 Numeric The buy amount of the deal in the buy curr
224. r wise Currency wise HNetted Limits Tracking Settlement Risk Settlement Risk Credit Line Risk Weighted Risk Risk Weighted Credit Line Pre Settlement Risk Pre Settlement Risk Credit Line Date Time Modification Number Authorized Cancel Date Time Ope Customer Number Specify the Customer or FX Netting group customer for which you are specifying the risk netting details The adjoining option list displays all open and authorized CIF from Customer maintenance You can choose the appropriate one Risk Netting Type You can specify the type of risk netting to be followed for the selection of contracts Risk netting can be one of the following e Pair wise The FX contracts with the same branch counterparty value date and currency pair will form a netting group When you choose to net contracts pair wise for counterparty all contracts that involve the same currency pair will be netted e Currency wise You can opt to net contracts currency wise FX contracts that have the same branch counterparty value date and currency will form a netting group n this case contracts with different currency pairs would also be selected for netting if transactions involve the same currency In the Netting Type field indicate if you would like to net contracts Currency wise or Pair wise If you would like to net contracts Pair wise click on the button against Pair wise If you would like to net contracts Currency wise choose the button
225. rage applicable to the broker will be picked up from the Brokerage Rules table Cross Currency Deals Allowed If a deal involves currencies other than the local currency it is referred to as a cross currency deal For a product that you are creating you can opt to allow or disallow cross currency deals e f you opt to disallow cross currency deals for a product you cannot enter a deal that does not involve the local currency e f you opt to allow cross currency deals you can enter a deal involving or not involving the local currency To allow cross currency deals choose Yes by clicking on the button against it To disallow cross currency deals choose No by clicking on the button against it Auto Liquidation Allowed Foreign exchange deals can be liquidated automatically or manually In the Product Preferences screen you can indicate whether the mode of liquidation of deals involving a product is e Manual e Automatic If you specify the automatic mode of liquidation deals involving the product will automatically be liquidated on the Settlement Date during the Beginning of Day processing by the Automatic Contract Update function If you do not specify auto liquidation for a product you have to give specific instructions for liquidation through the Manual Liquidation screen on the day you want to liquidate a deal If the Value Date of a deal is a holiday the deal will be liquidated depending on yo
226. rage details of contracts for whom the brokerage has been liquidated on any day between this date and the date given in the next field will be reported The system defaults to today s date To Date Enter the date up to which the report is to be generated For the selected broker s the brokerage details of contracts whose Value Date falls between this date and the date given in the previous field From Date will be reported The system defaults to today s date This date should be later than or the same as the From Date specified in the previous field Click OK button to generate the report Click Exit if you do not want to generate it 12 9 1 Contents of the FX Brokerage Details Report The contents of brokerage details have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body The contracts will be listed based on the broker involved in the deal For each broker the following information will be given Broker Code The code that has been allotted to the Broker in the Broker Details table Broker Name The full name of the broker as recorded in the Broker Details table Date Range The period for which the report is being generated specified by you through the Report Options screen
227. reciates against USD Oracle FLEXCUBE supports the NDF forward contract using a Two deal approach In this approach two contracts are initiated manually they are First deal NDF Forward Contract is a forward deal between the settlement currency and the NDF currency Second deal NDF Fixing Contract will be a spot deal which is used as a fixing deal for the NDF deal You can initiate manually NDF Fixing Contract The fixing date for the NDF Forward Contract will be the settlement days for the settlement currency before the maturity date of the NDF Forward Contract For both the contracts NDF Forward Contract and NDF fixing contract the NDF currency amount is the same only the settlement currency amount changes depending on the exchange rate at the day of booking NDF forward contract and NDF fixing contract NDF Currency The NDF currency is one among the Bought and Sold currency of the NDF Forward contract For an NDF Forward Contract this field is defaulted from product selected but can be changed For an NDF Fixing Contract NDF currency is defaulted from NDF Forward Contract and it cannot be changed NDF Fixing Status Indicate the fixing status of the NDF Forward Contract It is applicable only for NDF Forward Contract The values of the field are Fixed and Not Fixed NDF Fixing Date Indicate the date on which the difference between the existing market exchange rate and the agreed upon exch
228. ries on 31 1 08 Forward Rate for 14 days USD 1 INR 46 00 Interest rate for 15 days 10 i ORACLE Profit 100 000 46 100 000 45 INR 100 000 INR 100 000 is the profit that will be realized on 15 2 08 Hence the Net present value of the profit will be 100 000 1 10 100 90 909 10 The accounting entries will be as follows Dr Fwd Adj GL INR 90 909 10 Cr Exchange P L INR 90 909 10 Account Balances Exchange P L INR 90 909 10 Cr Fwd Adj a c INR 90 909 10 Dr Fwd Bought a c USD 100 000 INR 4 500 000 Dr Fwd Sold a c INR 4 500 000 Cr Straight Line method In this method the spot rate on the date of revaluation is used for calculating the revaluation profit loss You enter the following forward deal INR is the local currency Trade Date 1 1 09 Maturity Date 15 2 09 Bought USD 100 000 Sold INR 5 000 000 Deal Rate USD 1 INR 50 00 Spot Rate USD 1 INR 51 00 Profit Bought amt Spot rate Bought amt Deal rate That is Profit 100000 51 100000 50 INR 100 000 Now the Period for which the contract needs to be revalued 45 days Jan 31 days Feb 14 days When you revalue the contract using the Straight Line revaluation method the profit INR 100 000 would be accrued over 45 days The following would be the Accounting Entries and Balances Accounting Entries on 1 1 09 Dr Forward Bought USD Contingent Asset USD 100 000 INR 5 000 000 Cr Forward Sold INR Contingent Liabi
229. risk tracking from the option list The list displays all valid credit lines applicable for the counterparty Track Pre Settlement Risk This option will be enabled only if the Revaluation is set to Y at the Product level and the Limits Tracking option is checked Check this option if limit tracking on the revaluation gain for FX contracts is required Pre Settlement Risk Credit Line Pre settlement risk is the risk that one party of a contract will fail to meet the terms of the contract and default before the contract s settlement date prematurely ending the contract This field will be enabled only if the Limits Tracking option and Risk Tracking option is selected else it will be made NULL and disabled Select the Credit line to be used for tracking revaluation gain loss from the option list The list will display all valid credit lines applicable for the counterparty and product Track Weighted Risk This option will be enabled only when the Limits Tracking option is checked Check this option to specify that limit tracking should be carried out on the risk weighted amount for FX contracts under this product Weighted Risk Credit Line Select the credit line that should be used for netted risk weighted limit tracking from the option list The list displays all valid credit lines applicable for the counterparty Risk Percent The risk percent for the contract is displayed here The risk percent will be fetched from risk percent
230. rrency and Rate Type should be maintained in the form of discount points a percentage The rate that you enter against each period will apply to contracts whose transaction date is between the Base Date and the Actual Date In the Discounting Rates column you must specify the discounting rate for the period code that you specified in the previous column for a currency Actual Date The system displays the actual date on which the period that you specified ends Example You specified the Base Date as 01 Jan 09 in the Base Date field You want to maintain discounting rates for AUD for the following periods e 10 days e 200 days etc In the Actual Date column you will see the following dates displayed for the corresponding periods Against 10 the actual date would read 11 Jan 09 that is ten days from 01 Jan 09 Against 200 the actual date would read 20 Jul 09 that is 200 days from 01 Jan 09 ORACLE 3 4 1 Specifying UDF Values You can associate values to all the User Defined fields created and attached to the Discounting Rate Maintenance screen You can view the list of User Defined fields associated to this screen by clicking Fields button in the Discounting Rate Maintenance screen User Defined Fields User Defined Fields Field Name OK Cancel You can enter the value for the UDFs listed here in the Value column For more details on how to create user Defined fields refer chap
231. rrency wise netting The netting days for GBP USD and CAD are set as 0 The Netting Days Basis for the customer is set as Netting Agreement and the mode of netting is Manual On the 10 of January 2009 when the manual netting batch is run for the customer with currency All the system will net all the GBP USD or CAD bought sold legs having a value date of 10 January 2009 since the netting days for all these currencies is zero The resultant netting will be as follows Netted Netted Value Date Remarks Currency Amount CAD 5580000 10 Jan Amount 2009 due wee ORACLE Neitted Currency Netted Amount Value Date Remarks GBP 1870000 10 Jan 2009 Amount due When manual netting batch is run for the customer on 11 January 2009 for all currencies the following will be the result Netted Netted Value Date Remarks Currency Amount USD 6840000 11 Jan Amount 2009 Payable 6 2 10 Capturing the Revaluation Tab Details Revaluation and P amp L information should be specified for a contract involving a product defined for revaluation using the Straight Line revaluation method Product Code Counterparty Dealer Source Product Description Profit and Loss Currency Spot Rate Spot Date Bought Interest Rate Sold Interest Rate Spot Local Currency Equivalent Discounted Amount in Local Currency Contract Amount
232. rty Name Short Name Product EJ M CHOFXAL001850016 CHOFXAL001850016 MARKT kernel kernel FXAL M CHOFXAL001850017 CHOFXAL001850017 MARKT kernel kernel FXAL M CHOFxAL001850018 CHOFXAL001850018 MARKT kernel kernel FXAL M CHOFxAL001850019 CHOFXAL001850019 MARKT kernel kernel FXAL M CHOFXSP001850034 CHOFXSP001850008 MARKT kernel kernel FXSP z 4 E gt Contract Details m Amount Tag Tag Currency Branch Account PayRecy Intermediary Reimbursement Institution Receiver cores ill PT OFXTX1_AMT USD CHO INDSBLUSDCI i PT FXTX2_AMT USD CHO INDSBLUSDCI ii 7 PFX_AMND USD CHO INDSBLUSDCI i FT PFX_CHG1 USD CHO INDSBLUSDCI i T SETACCR_BO USD CHO INDSBLUSDCI i gt sss SSS __ ji Authorize x View Error After selecting the contracts click on Authorize button to authorize the contracts ae ORACLE 6 8 14 Viewing the errors If the system encounters any errors during the authorization of a particular contract it will record the error and move on to the next contract Example Among the contracts selected for authorization there may be certain contracts which are created by the user who is authorizing As the maker and checker cannot be same system will record an error as it cannot authorize the contract Click on View Error button to view the details of the errors recorded In this screen system will display the reference number of the contracts which could not be authorized and the reason for the failure of co
233. ructions for liquidation through the Manual Liquidation screen on the day you want to liquidate a deal ae ORACLE If the Value Date of a deal is a holiday the deal will be liquidated depending on your specifications in the Branch Parameters table In this table e If you have specified that processing has to be done on the last working day before the holiday for automatic events the deal falling on the holiday will be liquidated during the beginning of day processing on the last working day before the holiday e If you have specified that processing has to be done only on the system date for automatic events the deal falling on a holiday will be processed on the next working day after the holiday during beginning of day processing 6 2 4 To indicate that you would like to liquidate a contract automatically on the value date click on the box adjacent to Auto Liquidation The exchange rate type Different types of exchange rates can be maintained in your branch For example you can define a set of exchange rates buy and sell for USD for deals with banks and another set of rates for deals with walk in customers When you define a product you specify an Exchange Rate Type for it The exchange rate corresponding to the Rate Type defaults to all contract entered for the product Changing the Exchange Rate You can change the exchange rate that is maintained for the currency in the currency table Only the change
234. s a list of reports that can be generated in this module and also explains their contents 1 1 3 Related documents e The Core Services User Manual e The Procedures User Manual 1 1 4 Glossary of Icons This User Manual may refer to all or some of the following icons Icons Function New Cy Copy Save Delete ira Unlock ea Print Z Close fs Re open pn Reverse R Template a ORACLE Icons Function S Roll over M Hold E Authorize a Liquidate Exit F Sign off P a Help E Add row Delete row Option List k rT Confirm Enter Query t 3 F Execute Query Refer the Procedures User Manual for further details about the icons r ORACLE 2 1 2 An Overview of the Foreign Exchange Module Introduction Foreign Exchange FX transactions involve one party purchasing a quantity of one currency in exchange for paying a quantity of another When goods are traded across boundaries the selling and the buying firms prefer to receive pay consideration in a currency of their choice Firms as well as governments borrow foreign currency internationally When they trade or borrow multiple currencies come into play There has to be a market that enables participants to buy and sell currencies in such a way that they
235. s also qualified to process CLS deals i e the branch should also be marked as a CLS Participant refer the section titled Maintaining CLS Preferences for the branch in this chapter before allowing the same for the customer CLS Currency Restrictions Restriction Type Allowed Disallowed Restricted Currencies o Currency Description Ok Cancel All the currencies that are allowed for CLS trading will be listed as available currencies You may define a list of allowed or disallowed CLS currencies for a specific customer By default every customer who is a CLS Participant will be allowed to trade in all the available CLS currencies unless specifically mentioned Only if the customer is allowed to transact in a CLS currency the particular deal will be eligible for CLS trading 7 4 ORACLE 7 1 4 Maintaining CLS currency preferences for the branch You can maintain CLS preferences exclusively for currencies that are allowed to participate in CLS trading You may use the CLS Currency Details screen available in the Application Browser for defining the CLS preferences You can invoke the CLS Currency Maintenance screen by typing FSDCLSCD in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button CLS Currency Maintenance Currency Continuous Linked Settlements Cutoff Time Cancellation Cut off Days Trade Cut off us Days Hour Hour
236. s if the same is in excess of the product transaction limit and user input limit If this holds true the system indicates the same with below override error messages e Number of levels required for authorizing the transaction e Transaction amount is in excess of the input limit of the user oe ORACLE Sold Amount Adjacent to the Currency field is the Amount field You must enter the sold amount of the sold currency here Against the Sold currency enter the sold amount in the Amount column You can enter the amount in numerals and then enter e T to indicate that the amount is in thousands e M to indicate that the amount is in millions e B to indicate that the amount is in billions On saving the transaction after entering all the required details in the system the system validates the value of the bought amount against the following e Product transaction limit e User Input limit If the transaction currency and the limit currency are different then the system converts the amount financed to limit currency and checks if the same is in excess of the product transaction limit and user input limit If this holds true the system indicates the same with below override error messages e Number of levels required for authorizing the transaction e Transaction amount is in excess of the input limit of the user Bought Value Date Enter the value date for the bought leg of the contract in the Value date column Against t
237. s option list ov ORACLE User Reference Number This is defaulted from the contract online Outstanding Amount This is defaulted from the contract online Currency This is defaulted from the contract online Counterparty This is defaulted from the contract online Dealer This is defaulted from the contract online Buy Sell The Buy option is selected if it is a Buy type of deal If it is a Sell type of deal the Sell option is selected Liquidate Cancel This indicates whether the deal is liquidated or cancelled Bought Sold Currency The currency of the bought leg and the sold leg of the FX contract is displayed in the Bought Currency and Sold Currency respectively Bought Sold Amount FX deals can be cancelled partially and the balance either extended or settled You also have the option of cancelling the deal completely Similarly you also have the option of liquidating the deal either partially or fully The entire amount involved in the deal will be picked up and defaulted in the Bought Sold Amount fields respectively If you are performing a partial liquidation you have to specify the amount that is to be liquidated If not the entire amount will be liquidated and the system will treat it as an early settlement of the deal Similarly if you are performing a partial deal cancellation you have to indicate the amount that is to be cancelled When the deal amount is left as it is the system will treat it as deal
238. sary 11 1 Important Terms Forward Rate The exchange rate used for revaluing a forward foreign exchange contract according to the Rebate or NPV methods Discounting Rate For a currency these are the rates used in arriving at the Net Present Value of an outstanding foreign exchange contract Spot Rate The exchange rate used for a spot deal on a given business day Netting Summing of two or more accounting entries passed to an account for the same event so as to arrive at a net figure for posting Split Value Date The Value Date of either the bought or sold leg for an FX deal If split value dates are specified both value dates could be different Clean Risk The limit on total value of deals settled with a counterparty on a given business day Total Risk The limit on total exposure to a counterparty due to all deals done with that counterparty Settlement Risk The risk that one party will fail to deliver the terms of a contract with another party at the time of settlement Settlement risk can be the risk associated with default at settlement Pre settlement Risk The risk that one party of a contract will fail to meet the terms of the contract and default before the contract s settlement date prematurely ending the contract The risk is equal to the replacement value of the original contract Foreign Exchange Swaps Simultaneous sale and purchase of identical amounts of one currency against another for different
239. scactssstctesd chs tesaceta doses Mositai E a a AEO AEAEE ET EESE 12 14 12 10 1 Contents of the FX Contracts to be Rolled Over Report ccscsccssesscssesseeseeseeeeeeeeeecneeeeensseeeeaees 12 15 12 11 FX DAILY EXCEPTION REPORT AUTOMATIC PROCESSING ccccsssececseseeeessseeeceeaeeecenseeeessneeeesenaees 12 15 12 111 Contents of the FX Daily Exception R Port cccccccccsccesscesscesecesecesecusecsseesseeseeeseesaeenseeseenseenaes 12 16 12 12 FX STRAIGHT LINE CONTRACTS SPOT REVALUATION REPORT scecsescecesseeeeceesaeeecseseeeesseeeenesaees 12 16 12 12 1 Contents of the FX Straight Line Contract Revaluation Repoftt snose 12 18 12 13 FX STRAIGHT LINE CONTRACTS ACCRUAL REPORT cccsssseceesesceceeuececseccececaeeeceesaeeeceneeeeessrseenenaees 12 18 12 13 1 Contents of the FX Straight Line Contracts Accrual Control Report s es 12 19 12 13 2 Contents of the FX Rebate and NPV Revaluation RePOrt cscsccssescssecssesecsceeseeseeseeseeeeseeneeeeens 12 20 12 14 NETTING REPORT BY NETTING DATE AND CUSTOMER FX TO FT ceccccceeseceeeeseececeeeeecessseeecneaeers 12 21 12 15 NETTING REPORT BY NETTING DATE AND CUSTOMER FT TO FX cc cccessscceceeseecesssececeesseeeeseaeees 12 22 12 16 NETTING REPORT BY MATURITY DATE AND CUSTOMER FX TO FT cccecssseceestececsseeecessseeeesseaeees 12 22 12 17 NETTING REPORT BY MATURITY DATE AND CUSTOMER FT TO FX c ccceceesseceesteeeceseeeessteeeeesaaes 12 23 12 18 FT DETAILS FOR A
240. se currency All whereby all currencies in which the customer has dealt with will be manually netted ae ORACLE 6 2 9 Currency Pair The adjoining option list displays a list of all currency pairs that the specified customer has dealt which also require to be netted You can specify the pair for which you wish to initiate manual netting Alternatively you may specify All All as the currency pair whereby all the currency pairs in which the customer has dealt with will be chosen for manual netting Choose the appropriate one While initiating the manual netting process If you have specified a currency for manual netting the system will pick up all contracts of the customer having the particular bought or sold currency whose value date is less than or equal to the netting date and which requires netting If you have selected currency All all the contracts of the given customer will be chosen If you have chosen a currency pair the system will pick up all the contracts having the same currency pair that requires netting If you have specified the All All as the currency pair all the contracts for that customer will be picked up for manual netting If currency All or currency pair All All has been chosen an override will be displayed to confirm whether netting needs to be performed for all the currencies Automatic and Manual FX Netting Batch Automatic netting process will pick up all t
241. sed by the system Click OK button to generate the report Click Exit button if you do not want to generate it Rene ORACLE 12 13 1 Contents of the FX Straight Line Contracts Accrual Control Report The following details are given for contracts in each currency Reference No The Reference number of the contract Previous Total The Premium or Discount Amount that had been accrued till the Accrual previous revaluation Current Debit The discount amount that was accrued on the last revaluation Accrual Total Debit Accrual The total discount amount that has been accrued so far Current Credit The premium amount that was accrued on the last revaluation Accrual Total Credit Accrual The total premium amount that has been accrued so far FX Rebate and NPV Revaluation report This report gives details of revaluation on contracts which have been revalued through the Rebate or Net Present Value NPV methods You have to select the currency and product through the Report Options screen Report For Currencies In this field you can specify the currencies for which the report is to be generated If you select e All Currencies The details of revaluation on contracts involving any currency allowed for the branch will be reported e Selected Currencies The details of revaluation on contracts involving only the currency ies you select in the next field will be reported Currencies
242. should use the Liquidate operation Apart from the Counterpart and the Booking Date of the contract you will be allowed to modify the details of an FX contract such as the Exchange Rate Value Date and Settlement Instructions before the settlement date Upon authorizing this event you have to generate the appropriate MT 300 The revaluation will be corrected when the contract get automatically revalued at the specified frequency ror Note that you will not be allowed to amend a contract once you have performed a partial liquidation or cancellation Accounting entries for the amendment If you change the amount or the exchange rate involved in the contract the accounting entries that were passed for the contract when it was stored will be reversed and fresh entries will be passed for the new values Amending a deal involving a product combination You can amend the details of a leg only if it is yet to be liquidated The fields that can be amended in such a case and the impact of the amendment are the same as that for fields in a contract that does not involve a product combination Sor Please note that the roll over instructions cannot be specified for a contract involving a product combination Uploading the contracts for amendment From an external system you can upload contracts that require amendment in Oracle FLEXCUBE The system will distinguish between the new and the contracts that require amendment based on the action code of t
243. si otai eiia a aeaa 9 6 9 2 7 ROVersal GQVICE sis hsistettcheiteeeti hs Gddeigibpeitaa atte eaae ia a aiea aa fet 9 6 9 2 8 Advice of Cancellation MT292 evscisiesitseicessnatilavcsvsstieiegdiiadsvad sadientbetees eased ap noi iseasi a reii Ea Erai 9 7 9 37 MESSAGES eresie ar rE E E EET E EET EET EE E TEE 9 7 9 3 1 Generating Payment Messages cccccccccesccesceseesseeeccesscesecuseceaecuaecaaecaeeeasecaeeeaeeseeeeeeseseeseesenesenaeeaas 9 8 9 3 2 Generating Receive MesSAgeS scsscescseseesseeseeeseeescesecsecuaecuaecaaecaaecaaeeaseeaeeeseeeeeeseeeeeseaeseaeeaeeaeenae 9 9 9 3 3 Generating User Ref No in Messages 1 1 cssccssesseessesseeeeeseeeseeeceeeeensecesecaecuaecaaecaaeeaaeesseeaeeeaeeaeees 9 10 9 3 4 Generating Cancellation Request Messages 1 1 csscsscessessseeseenseeseeseeeseceeecusecusecesecnaecaeenseeeeeneees 9 11 10 ANNEXURE A ACCOUNTING ENTRIES AND ADVICES ssssesseeeseroeseseeeccerosoesesescecosoroeseseeceoesosoesee 10 1 10 1 ACCOUNTING ENTRIES FOR FOREIGN EXCHANGE cccccccssssessescsseseeecnseseescsesecscnseseceesscsecessacsecesacseceenaens 10 1 10 27 EX EVENTS oeccesessecsccsesecscsdese cnc cueseteceitgets dostserecesagoutd E nET n AR EEEn OA E R EEEE AEE ARS EEOAE ER EER EEE 10 1 10 AMOUNT TA eia a E E A AN EEEE A EE E 10 2 10A ACCOUNTING ROLES 2 225 cssish cbestascnstassssabersnscoslasenceneetnsanalsdoue MessnetshlestatedestesasetadescoMeasbeevuraseareteatesssersye 10 3 ORACLE 10 5 EVENT WISE ACCOUN
244. sreseseserresesesesesrenrssssrsesrerretssseseseeseerse 6 51 6 8 16 Viewing the Details of the CONC scsccesssssscssessesecssesecnseeecseeseesecseesecuseeeeaeecesaeeseesesseeeeeeesaeeseees 6 52 6 8 17 Rolling Over a Contract Manually w0 ccesccesccescceseesseesseeseeseeseeeseesseeeeeeseeseeeeseesaecnsecaecuaecaaecaaseneseneeas 6 52 6 8 18 Registering the Confirmation for a CONEIACE scsccesecssesecseeseeseessesecaeesecuseeeeseesceaecaeeceeaecaeesesneeseees 6 53 6 8 19 Liquidating a contract MANUALLY ecccesces ces ceteeseenseeseeeseeeccescessceeaceseeseeceseceaecuaecuaecsaecauecsaseneeeaeeas 6 56 6 9 THE LIQUIDATION AND CANCELLATION FUNCTION ccsessssssecececssssseeceeececsesseaeseeececeesssaeseesecesesseaeeeeeeeees 6 57 6 9 1 Authorizing FX Payment Details ccccccccceecceeccesscesecesecesecsecaeeeaeeeseesececeeeaeeeaeeseeeseeeeceaeenaeenaeeaeens 6 60 6 10 REASSIGNING A CONTRACT TO ANOTHER USER ccssssssssescscsseseseeecesscsesseseseseceesssessesesessssesesseseseseeseeenees 6 61 6 11 VIEWING EX PAYMENT DETAILS iai ches ennie ea E T EE EE EARNE E E e E EE 6 62 6 12 VIEWING FX CONTRACT orrein e E e E EEE E E E E EE 6 65 6 13 ONLINE QUERYING FOR FX POSITIONS Snina AE T A 6 68 6 13 1 Viewing the details of the individual deals that contribute to the position nsss 6 69 ORACLE 6 14 DEFINING INTERNAL SWAP TRANSACTIONS cccccccseeeseseseseseseseseseceseseseseceseseseseseseseseseseseseseseseceseseeeeenees 6 71 6
245. st it It will create an unauthorized version of the NDF Forward Contract with following details updated e NDF Related Reference Number changed to NDF Fixing Contract Reference Number e Net Settlement Amount of the NDF Forward Contract e Fixing Status as Fixed e _UFIX Unfixing It is processed for the NDF Forward Contract to reverse all accounting entries on reversal of NDF Fixing Contract It creates an unauthorized version of NDF forward contract with the following details updated e NDF Related Reference Number is set to NULL e NDF Settlement amount is set to NULL e Fixing status is set as Unfixed The following operations are changed for an NDF Forward Contract e Amendment This operation is not allowed for an NDF Forward Contract if the fixing status is FIXED e Rollover This operation is not allowed for an NDF Forward Contract if the fixing status is FIXED e Liquidation This operation is not allowed until the contract is FIXED and FIXG is authorized e Other operations If the maturity date is less than the current date then the LIQD and SGEN event will be executed on authorization of FIXG event Otherwise the liquidation will happen with the EOD batch i ORACLE The Liquidation event is changed for the NDF Forward Contract to use the net settlement amount and settle the amount between the NDF profit or loss account and the customer The SGEN event Settlement message event generation generates the payment
246. stem Date option the contract is revalued as part of the BOD process on 15 September 2003 If you select the Reval Till Next Working Day 1 option contract revaluation is triggered as part of the EOD process on 12 September 3 2 1 2 Setting Parameters for Reversal of Revaluation Entries Revaluation entries can be reversed in either of two ways according to your specification Account Revaluation If you select this option revaluation entries passed during the EOD process are reversed as part of the account revaluation process on the next working day You must ensure that the account revaluation process is run before running the contract revaluation process Deal Level If you opt for deal level revaluation reversal a BOD process reverses the contract revaluation entries posted the previous day Revaluation entries are posted and reversed at the level of individual contracts You must run the revaluation reversal batch before running the contract revaluation process Running the account revaluation process is not necessary in this case Note the following e If you try to run the deal level revaluation reversal batch in spite of having opted for Account Revaluation as part of FX Branch Parameters definition an error message will be displayed e Ifyou have opted for deal level revaluation reversal while defining FX Branch Parameters revaluation reversal is triggered once before liquidation of a contract This revers
247. t Customer Role NDF_INC NDF Income Income Role NDF_EXP NDF Expense Expense Role Note that the following accounting roles PRE_DIS INCOME PRE_DIS EXPENSE and INCEXPAMORTZN are used only for Straight Line revaluation products 10 5 Event wise Accounting Entries and Advices In this section we will discuss the suggested accounting entries and advices that should be generated for each event in the life cycle of an FX deal Also note that some of the Amount Tag s linked to the Accounting Roles are user defined 10 3 ORACLE Accounting Entries 10 5 1 BOOK Booking an FX contract Accounting Role Amount Tag Dr Cr Indicator CONTINGENT BOT BOTAMT Debit CONTINGENT SOLD SOLDAMT Credit BROK_PAID BROKAMT Debit BROK_PAYABLE BROKAMT Credit Advices Advice Name Description FX_DEALSLIP Deal Slip FX_DEALRMTLX Dealing Room Confirmation Advice FX_BROKERAGE Brokerage Advice FX_CONFIRMN Confirmation Advice NDF_CONF_ADVICE NDF Confirmation Advice on BOOK event of NDF Forward Contract The following new tags are introduced for NDF Contracts for advice generation Advices MSG_TAG Remarks _NDFCUR_ NDF Currency _NDFBASIS _ NDF Fixing Basis _NDFSETCCY_ NDF Settlement Currency _NDFFIXINGDATE_ NDF Fixing Date _NDFACTFIX_DATE_ Booking Date of NDF Fixing Contract _NDFSETAMOUNT_ NDF Settlement Amount _NDFF
248. t has been rolled over manually you have to perform two authorizations one for the liquidation of the original contract and another for the initiation of the new contract When you invoke such a contract for authorization the details of the liquidation of the original contract will be displayed The procedure for authorizing the rolled over contract is similar to the one for authorizing a new contract 6 8 18 Registering the Confirmation for a Contract You can register two types of confirmations on an authorized contract They are e Counter party confirmation e Broker confirmation Not all authorized contracts need to be confirmed You can confirm a contract only if there is a necessity Further for a contract you can register e Only the counter party confirmation e Only the broker confirmation e Both the confirmations You can register a confirmation on a contract that has been liquidated You can invoke the Contract Confirmation screen from one of the following screens e Contract Summary View e Contract Detailed View ae ORACLE In Contract Summary View select Confirm from the Processing sub menu when the contract is highlighted From the Contract Detailed View choose this option when the details of the contract are being displayed You will be prompted for an override if the contract has been liquidated Contract Reference Number Counterparty Bought Currency Sold Currency Broker Confirmation Bro
249. t is instead of making a payment of 13 000 EUR against 10 000 USD on Contract 1 and then paying 5000 USD against 6500 EUR on Contract 2 you can settle contracts 1 and 2 by netting the payment amounts in the settlement currency In this case if the settlement currency is USD you can make a one time payment of 6500 EUR to Cavillieri and Barrett Finance Corporation and receive USD 5000 from Cavillieri and Barrett Finance Corporation oe ORACLE 3 5 1 Maintaining Netting Details To net foreign exchange deals you must enter into a netting agreement with the counterparty concerned using the Foreign Exchange Netting Agreement Maintenance screen You can invoke the Foreign Exchange Netting Agreement Maintenance screen by typing FXDNETMA in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button These details will be used to net the FX contracts that you enter into with the counterparty Foreign Exchange Netting Agreement Maintenance Foreign Exchange Netting Agreement for Netted Pay Receive Fund Transfer Product Customer Number Outgoing Bank az Outgoing Customer A Internal laz Netting Details Netting Type Pair wise Auto Authorize Netted Fund Transter Currency wise Netting Days Basis O Currency Netting Mode Automatic Netting Agreement a Manual Netting Date Currency az Netting Days Standard Payment Details fo
250. t on sold amount The system will create new utilization for respective credit lines if the net amount is inflow The risk reference number for both the legs will be displayed in FX contract online If any match is found then the system will add subtract the bought sold leg amount to the netted settlement amount to arrive at new netted settlement amount For the risk weighted amount the system will compute new netted risk weighted amount using risk percent If the new and old netted amounts are inflow and the new netted amount is greater than the old netted amount then the system will increase the utilization of the line with the incremental value If the old netted amount was an outflow and the new netted amount is inflow then the system will increase utilization for the net inflow amount If the new netted amount is inflow but is lesser than the previous netted amount then the line utilization will be decreased with the differential amount provided the line is revolving If the new netted amount is outflow and the old netted amount was inflow then the system will reduce the line utilization to O provided the line is revolving If the new netted amount is outflow and the old netted amount was also an outflow then there won t be any utilization During the above process the tenor will be calculated based on rolling tenor of the contract When FX contract which forms part of netting bucket is deleted then the system will compute the new n
251. t or modification will be displayed when the contract is being authorized The central liability checks checks to see whether the credit limit allotted to the customer have been exceeded due to this contract will be done now If there are any excesses you will be prompted to give an override The contract will be authorized only if you give the overrides If not the contract will not be authorized and you will be returned to the Contract Detailed View screen 6 8 11 2 Capturing Change Log When an amendment is authorized the old values will be replaced with the new ones The details of the contract with the old values will be available in the earlier version of the contract Click on No button if you do not want to authorize the contract Click on Yes button if you want to authorize the contract You will be prompted to confirm the authorization After the contract has been authorized you will be returned to the screen from where you invoked the Contract Authorization screen Contract Summary View or Contract Detailed View Note the following You cannot authorise a contract in the following cases e the contract has multilevel of authorization pending the same will be done using the Multilevel Authorization Detailed screen e the level of authorization is greater than or equal to N e the Nth or the final level of the users authorisation limit is less than the difference between amount fi
252. t position in the currency LCY Rate The local currency rate that is applied on the current balance LCY Balance The LCY equivalent of the current position calculated using the LCY rate Euro Equiv The euro equivalent amount LCY Rate The exchange rate of the local currency E ORACLE 12 6 Unconfirmed FX Contracts Report This report gives the details of contracts that have not been confirmed i e the confirmation details have not been entered through the Confirmation screen for the contracts You can invoke this screen by typing FXRPCPCO in the field at the top right corner of the Application tool bar and clicking the adjoining arrow button Foreign Exchange Counterparty Confirmation Report Options Report Period Days after Contract booking Days before Maturity Number of Days Through the Report Options screen you have to specify whether the report has to give details of e Contracts that have not been confirmed a specific number of days after the initiation date or e Contracts that have not been confirmed a specific number of days before the contract settlement date Click OK button to generate the report Click Exit if you do not want to generate it Report Period You can specify whether the report has to include details of unconfirmed FX contracts based on a particular period e From the Booking Date or e To the Settlement Date No of Days This is the
253. t provides information on process exception To invoke the screen type FXRPPREX in the field at the top right corner of the Application tool bar and click the adjoining arrow button Foreign Exchange Process Exception Report Foreign Exchange Process Exception Report al O Single 12 25 1 Contents of the Report The contents of process exception report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body You can find the following details in the body of the report a ORACLE Process ID The identification code of the process Counterparty The code that identifies the customer Reference No The reference number of the contract Error Code The error code of the process Message The description about the error code 12 31 ORACLE ORACLE Foreign Exchange August 2010 Version 11 1 Oracle Corporation World Headquarters 500 Oracle Parkway Redwood Shores CA 94065 U S A Worldwide Inquiries Phone 1 650 506 7000 Fax 1 650 506 7200 www oracle com financial_services Copyright 2010 Oracle Financial Services Software Limited All rights reserved No part of this work may be reproduced stored in a retrieval system ado
254. ted Risk KJA ot Related Reference Number Reversed Reference Number Bill Reference Number Fund Identity Settlement Risk Credit Line Pre Settlement Risk Credit Line Weighted Risk Credit Line MIS Contract Status Fietas All Messages m P vw Continuous Linked Settlements Eligible Exclude from Continuous Linked Settlements Auto Liquidation The CLS eligibility of an FX deal will be automatically determined by the system Further you also have the option of excluding a CLS eligible deal from the CLS scheme and processing it as a non CLS deal You have to select the Exclude From CLS option to do this 7 2 1 Checking the CLS Eligibility of an FX deal The system will automatically mark an FX deal as CLS Eligible if the contract satisfies the required eligibility criteria Three levels of check will be performed before qualifying a contract as a CLS deal The criteria for each level are discussed below 7 2 1 1 First level validations The first level check will ensure the following e The branch is identified as a CLS Participant e The sold and bought currencies are identified as CLS currencies 7 17 ORACLE The CLS currency details are maintained for the Branch Bought Currency and Branch Sold Currency combinations The customer of the contract is a CLS participant who is allowed to deal in both the bought and sold CLS currencies The
255. ter Creating custom fields in Oracle FLEXCUBE in the User Defined Fields User Manual under Modularity oe ORACLE 3 4 2 3 4 2 1 3 4 3 Querying Discount Rates While processing a contract that involves discount rates you can query the discount rates applicable to a Currency and Rate Type combination for a specific period using the Discount Rates Query screen You can invoke the Discount Rates Query screen by typing FXDQIRAT in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Discount Rates Query Exchange Rate Rate Type laz Currency Tenor Dates Tenor Start Date End Date QUERY Discount Rate Rate Type You can query the discount rate for a Currency and Rate Type combination Here you need to select the Rate Type for which you are querying discount rates Currency Select the currency for which you are querying the discount rates You can query discount rates for a Currency Rate Type combination based on either of these e A date range e Tenor Querying Based on Dates Start Date Select the start date for which you want to query discounted rates End Date Select the end date for which you want to query discounted rates Querying Based on Tenor Tenor Select this option if you want to query rates for a specific tenor T ORACLE 3 5 Days Specify the number of days for which you want deta
256. terparty wise The value date of the bought currency leg and that of the sold currency leg are considered individually to arrive at the netting date When you net the foreign exchange deals involving a customer currency wise the net payment in each currency will be computed for the customer In this case contracts with different currency pairs would also be selected for netting if transactions involve the same currency ii ORACLE The status of a contract that has been specified for currency wise netting can be any of the following e Not Netted status before netting e Bought Netted sold not netted in case of currency wise netting where the bought leg is netted before the sold leg in case the value date of the bought currency is before that of the sold ccy e Sold Netted bought not netted in case of currency wise netting where the sold leg is netted before the bought leg in case the value date of the sold leg is before that of the bought leg e Both Bought and Sold leg netted When the netting process is run only contracts that have not already been netted will be netted That is only those contracts that do not belong to the status both bought and sold netted will be netted The bought and the sold legs bought currency and sold currency of the contract will be netted individually The system ensures that the leg to be netted is not already netted The following example illustrates the currency wise netting process
257. the Euro Closed option for the Euro in the Currency Definition screen vee ORACLE Currencies The currency codes of all the currencies defined for your branch are displayed here If you have chosen the Selected Currencies option in the previous field you can select the currencies that you want to include in the report Tenor Enter the tenor in days of the contracts to be included in the report For the specified currency ies the net currency position due to contracts with this tenor will be reported Click OK button to generate the report Click Exit button if you do not want to generate it 12 5 1 Contents of the FX Tenor wise Currency Position Report The contents of FX tenor wise currency position report have been discussed under the following heads Header The Header carries the title of the report branch code branch date user ID module from which the report has been generated date and time at which the report has been generated and the page number of the report Body The options you have selected through the Report Options table tenor in number of days and the currency are given in the beginning of the report Details of contracts with a specific period and the currency position due to them will be reported as follows Period The period over which the specified tenor extends CCY The S W I F T Code of the currency whose position is being reported CCY Balance The curren
258. the Previous Year Adjustment GL maintained in the Chart of Accounts are reversed instead of reversing the entries in the Exchange P amp L GL For forward contracts with discounted straight line revaluation No revaluation reversal takes place Example Sample accounting entries booked at the time of EOD revaluation of a forward foreign exchange contract with straight line method of revaluation are given below Accounting Role Amount Tag Debit Credit Amount GL Indicator Unrealized Fwd REVPROFIT Revaluation Profit Debit 100 P amp L Exchange Profit REVPROFIT Revaluation Profit Credit 100 mare ORACLE Accounting Role Amount Tag Debit Credit Amount GL Indicator Unrealized Fwd UNAMORTINC Unamortized Income Credit 20 P amp L Discount Exchange Profit UNAMORTING Unamortized Income Debit 20 Discount Sample accounting entries posted during the deal level revaluation reversal of the contract event RRVL at next working day s BOD are given below Accounting Role Amount Tag Debit Credit Amount GL Indicator Unrealized Fwd REVPROFIT Revaluation Profit Credit 100 P amp L Exchange Profit REVPROFIT Revaluation Profit Debit 100 Unrealized Fwd UNAMORTINC Unamortized Income Debit 20 P amp L Discount Exchange Profit UNAMORTINC Unamortized Income Credit 20 Discount If the next working day is the first day of
259. their Settlement Member Deal between the Third Party and Counterparty type CLS Participant where the counterparty neither a Settlement Member or a Third Party Settlement Field Value Field Sender Ourselves Third Party Receiver Counterparty CLS Participant Bought Side 53 BIC of their Settlement Member Third Party BIC 56 CLSBUS33 57 BIC of the Settlement Member as maintained in the FX Branch Parameters CLS Preferences screen Sold Side 53 BIC of the Settlement Member as maintained in the FX Branch Parameters CLS Preferences screen 56 CLSBUS33 57 BIC of their Settlement Member Third Party BIC 7 2 1 3 Third level validations The third level check will be performed only if the first and second levels checks are successful As part of this check for trades done on the trade cut off date the system will verify the trade cut off times defined for both the bought and sold currencies of the deal and consider the earlier of the two as the actual cut off time for the deal If the third level check is not satisfied the system will display the following override message Cut off time has passed for CLS currency ORACLE 7 20 If you select OK and ignore the message the deal will be saved as a CLS deal Otherwise it will be considered as a non CLS deal 7 2 2 Processing a CLS deal as a non CLS deal You can process a CLS eli
260. tion Credit Exchange Loss Loss Previous Year UNRLZ FWD P amp L Asset UNAMORTINC Unamortized Debit Unrealized Fwd P amp L Liability Income EXCHANGE PROFIT Income UNAMORTINC Unamortized Credit Exchange Profit Income UNRLZ FWD P amp L Asset UNAMORTINC_PY Debit Unrealized Fwd P amp L Liability Unamortized Income Previous Year EXCHANGE PROFIT Income UNAMORTINC_PY Credit Exchange Profit Unamortized Income Previous Year EXCHANGE LOSS Expense UNAMORTEXP Unamortized Debit Exchange Loss Expense UNRLZ FWD P amp L Asset UNAMORTEXP Unamortized Credit Unrealized Fwd P amp L Liability Expense EXCHANGE LOSS Expense UNAMORTEXP_PY Debit Exchange Loss Unamortized Expense Previous Year UNRLZ FWD P amp L Asset UNAMORTEXP_PY Credit Unrealized Fwd P amp L Liability Unamortized Expense Previous Year 10 5 1 8 Accounting Entries SGEN Settlement Message No accounting entries allowed for this event Advices Advice Name Description PAYMENT_MESSAGE Payment Message 10 10 ORACLE 10 5 1 9 FIXG FIXING Accounting Entries Nil Advices Advice Name Description NDF_Fixing_Advice On FIXG event of NDF Forward Contract 10 5 1 10 UNFIXG UNFIXING Accounting Entries Nil Advices Advice Name Description NDF_Reversal_ Advice On UFIX event of NDF Forward Contract 10 11 ORACLE 11 Glos
261. tor You need to select the Buy Sell indicator from the option list provided Buy Currency You need to specify a currency This will be used as the bought currency for the FX Spot transaction the sold currency for the FX forward transactions and the currency for the placement transaction Sell Currency You need to specify a currency This will be used as the sold currency for the sold currency of the FX spot transaction the bought currency for the FX forward transaction and the currency for the borrow transaction Buy Amount You need to specify an amount This will be used as the bought amount for the FX Spot transaction and the amount for the Placement transaction Sell Amount You need to specify an amount This will be used as the sold amount for the FX Spot transaction and the amount for the borrowing transaction Buy Interest rate You need to specify the interest rate for the MM placement transaction You can enter this value if the buy sell indicator is chosen as Buy If the internal swap transaction is Sell then the system will calculate the interest rate during the processing of the transaction and the same will be displayed in this field Sell Interest rate You need to specify the interest rate for the MM borrow transaction You can enter this amount if the Buy Sell indicator is chosen as Sell If the internal swap transaction is Buy then the system will calculate the interest rate during the processing of the transa
262. tracts will be processed as follows e The risk tracking for the contract will be done only when the risk tracking options are checked at the contract level e During FX contract initiation the system will create new utilization for weighted risk credit line with the Weighted risk amount of contract online e During FX contract amendment if credit lines are changed then the system will nullify the utilization of old credit lines and reinstate the same on new credit line e During FX contract amendment if limits tracking required option is disabled then utilization of the credit lines will be nullified e During FX liquidation the system will decrease the utilization of weighted risk credit line with the liquidated weighted risk amount of the contract online The weighted risk amount during liquidation event will be calculated on liquidated bought amount using risk percent of contract online e During FX cancellation the system will decrease the utilization of weighted risk credit line with the cancelled weighted risk amount of the contract online The weighted risk amount during cancellation event will be calculated on cancelled bought amount using risk percent of contract online oe ORACLE During Rollover event the system will decrease the utilization of weighted risk credit line with the liquidated weighted risk amount for the old version At the same time the system will increase the utilization of settlement credit line with the rollo
263. ts that you can generate Currency Forward Rates report FX Currency Analysis report FX Maturity Analysis report Contents of FX Disposition report FX Tenor wise Currency Position report Unconfirmed FX Contracts report FX Contract Activity report FX Contract Overrides report FX Brokerage details report FX Rollover Due report FX Daily Exception report Automatic Processing FX Straight Line contracts Spot Revaluation report FX Straight Line contracts Accrual report FX Netting report by Netting Date and Customer FX to FT FX Netting report by Netting Date and Customer FT to FX FX Netting report by Maturity Date and Customer FX to FT FX Netting report by Maturity Date and Customer FT to FX FT details for an FX contract report FX Discounting Rate Report Netting Agreement Broker Confirmation Journal Contract Maturity Due Report Fund Transfer to Foreign Exchange Netting Report FX to FT Netting Report Process Exception Report a ORACLE 12 2 Currency Forward Rates Report This report gives details about forward rates for different currency pairs over a given period You can invoke the screen by typing the code CYRFWRAT in the field at the top right corner of the Application tool bar and click on the adjoining arrow button Currency Forward Rates Report Currency Pair Currency Pair From Currency Pair Specify the currency pair for which the forward rates report needs to be generated The adjoining optio
264. tton Forward Rate Input Currency1 Currency2 Base Date Spot Rate Forward Rate Details C Petioa Final Rate pi y DOCS Date Time Modification Number Authorized A Authorized By Date Time El open 3 3 1 Maintaining forward rates for currency pairs 3 5 ORACLE When the Forward Rates Maintenance screen is displayed select New icon in the Application tool bar or click new icon In this screen you can e Define forward rates for a new currency pair or e Define forward rates for an existing currency pair but for a different base date Currency pair In this screen you must first indicate the currency pair for which you are maintaining the forward rate In the Currency 1 field you can invoke a list of the currencies that are maintained in your bank Double click on a currency to choose it This would be the first currency of the pair In the Currency 2 field choose the other currency that constitutes the pair The forward rates that you specify subsequently would apply to this currency pair Base Date The forward rates which you maintain subsequently will apply to all forward FX contracts from the base date The current system date will be displayed in this field Spot rate The spot rate for the day for the currency pair is displayed in this field The forward rate would be computed using the spot rate displayed in this field To compute the forward rate the premium or disc
265. ual contracts 7 2 ORACLE Revaluation At Product By checking this box you enable the passing of a consolidated revaluation entry at the product level for all forward FX contracts under that product User Reference Number in Messages Based on the specification you make here the system assigns the Tag 20 Sender s reference number of an SWIFT message to either user reference number or contract reference number Check this box if you want the system to apply the user reference number for sender s reference Tag 20 of the SWIFT messages sent If you leave the box unchecked the system applies the custom reference number according to the format or logic defined for the product that the contract uses This feature is applicable only for SWIFT messages sent out by Foreign Exchange module CLS participant You have to select this option to identify the branch as a CLS participant This will enable you to process the FX deals entered into at your branch via the CLS bank Only after you mark the branch as a CLS participant you will be allowed to maintain the following CLS preferences Settlement Member Here you have to select the BIC Code of the customer who will be the intermediary settlement member through whom the FX deals of your branch will be routed to the CLS bank The Messaging System of Oracle FLEXCUBE will identify this customer as the receiver of the MT 304 Confirmation Message Advice of a Third Party deal T Co
266. uccessful completion of the second level check the deal will be marked as CLS Eligible The following tables list the settlement fields for deals between the Third Party Oracle FLEXCUBE Branch and different counterparty types Deal between the Third Party and Counterparty type Settlement Member Intermediary Settlement Field Value Field Sender Ourselves Third Party Receiver Counterparty Settlement Member Bought Side 53 Delivery CLSBUS33 obtained from the CLS Directory for CLS Participant Type Agent CLS Bank 56 CLSBUS33 57 Receiving Agent BIC of the Settlement Member as maintained in the FX Branch Parameters CLS Preferences screen Sold Side 53 BIC of the Settlement Member as maintained in the FX Branch Parameters CLS Preferences screen 57 CLSBUS33 Deal between the Third Party and Counterparty type Third Party Settlement Field Value Field Sender Ourselves Third Party Receiver Counterparty Third Party Bought Side 53 BIC of their Settlement Member 56 CLSBUS33 ORACLE Settlement Field Value Field 57 BIC of the Settlement Member as maintained in the FX Branch Parameters CLS Preferences screen Sold Side 53 BIC of the Settlement Member as maintained in the FX Branch Parameters CLS Preferences screen 56 CLSBUS33 57 BIC of
267. unt ROLLSOLDAMT Rollover Sold Amount SETBOTAMT Bought Settlement Amount SETSOLDAMT Sold Settlement Amount SOLDAMT Sold Amount UNAMORTEXP Prem Disc Expense Amortization UNAMORTEXP_PY Unamortized Expense Previous Year UNAMORTINC Prem Disc Income Amortization UNAMORTINC_PY Unamortized Income Previous Year NDF_LOSS NDF Loss NDF_PROFIT NDF Profit In addition to these you can define amount tags as per your requirements for the ICCF and tax components that will be attached to the product 10 2 ORACLE 10 4 Accounting Roles The following list contains the accounting roles that are applicable to the FX deals you can process at your bank Accounting Role Description Role Type CONTINGENT BOT Contingent Bought Account Contingent Asset CONTINGENT SOLD Contingent Sold Account Contingent liability EXCHANGE PROFIT Exchange Profit Income EXCHANGE LOSS Exchange Loss Expense UNRLZ FWD PNL Unrealized Forward Profit And Loss Asset PRE_DIS INCOME Premium Discount Income Income PRE_DIS EXPENSE Premium Discount Expense Expense INC EXP AMORTZN Income Expense Amortization Asset Liability BROK_PAID Brokerage Paid Expense BROK_PAYABLE Brokerage Payable Liability FATAX1_EXP Tax Expense Role Forfatax1 Expense FATAX1_PAD Tax Paid In Adv Role Forfatax1 Asset FATAX1_PAY Tax payable for FATAX1 Liability NDF_SET NDF Settlemen
268. unt 251460 00 Contract Reference No 101FW1194001003 Buy or Sell Type B Buy Deal Currency USD Deal Amount 125730 00 LCY Rate 2 00 LCY Amount 251460 00 The Net Maturity Position is the total Deal Amount of all the contracts maturing on 01 02 96 In this case as all the three contracts involve the same amount the Deal Amount of the one sell contract offsets the Deal Amount of the buy contract The net amount here is 251460 00 USD This position will be indicated as Sell because the amount in the Sell contract is in excess of that in the Buy contract 12 5FX Tenor wise Currency Position Report This report gives the net currency position due to contracts having a specific tenor You have to specify the tenor spot one month two months etc and the currency through the Report Options screen You can invoke this screen by typing FXRPCCYT in the field at the top right corner of the Application tool bar and clicking the adjoining arrow button Foreign Exchange Tenor wise Currency Position Report Options LBL_FX_REPORT1 Currency All Single Currency The report furnishes the equivalent Euro values of amounts in an In currency The locked in exchange rates defined for the Euro against the In currency will be used for currency conversions The report will not furnish the In currency and equivalent Euro values when you close the In currencies and choose
269. ur specifications in the Branch Parameters table In this table e If you have specified that processing has to be done on the last working day before the holiday for automatic events the deal falling on the holiday will be liquidated during the End of Day processing on the last working day before the holiday e If you have specified that processing has to be done only on the system date for automatic events the deal falling on a holiday will be processed on the next working day after the holiday during Beginning of Day processing vee ORACLE Rollover Allowed You can specify whether foreign exchange deals involving the product that you are defining can be rolled over into a new deal if it is not liquidated on its Value Date If you specify that rollover is allowed for the product it will apply to all the deals involving the product However at the time of processing a specific deal involving the product you can choose not to rollover the deal If you specify that rollover is not allowed for a product you cannot rollover a deal involving the product When a contract is rolled over the terms of the original contract will apply to the new contract If you want to change the terms of a rolled over contract you can do so during contract processing or The rolled over contract will retain the reference number of the original contract Split Value Dates Allowed For a product you can indicate whether the Value Date settlement
270. urrency liabilities for a product all deals involving the product will be revalued regularly You can opt to revalue deals related to a product e Daily e Monthly If you want to revalue deals on a daily basis click on the button against Daily in the Frequency field If you want to revalue deals on a monthly basis choose Monthly by clicking on the button against it Spot contracts can only be revalued on a daily basis you will not be allowed to choose revaluation frequency as Monthly When you run the End of Day processes in your bank deals involving products specified for daily revaluation will be revalued In case of products specified for monthly revaluation the deals involving the products will be revalued during the End of Month processes Typically the End of Day operator would perform the revaluation process On Booking an FX deal If it is an LCY FCY deal the discounted amount of the LCY leg is taken as the LCY Equivalent of contract For an FCY FCY deal the local currency equivalent of the discounted amount of the non deal currency calculated at the prevailing exchange rate is taken as the LCY equivalent of the contract Contingent booking entries are passed for the discounted amounts On Revaluation The interest in both the currencies is accrued separately on a daily basis starting from the spot date till the maturity date of the contract The local currency equivalent of the FCY accrual entri
271. urrency that you want to indicate as the Netting Date Currency Netting Days When you specify the netting details for a customer you can also indicate the day on which the contracts involving the customer are to be netted This day could be a certain number of working days before the settlement date of the contracts Example If the value that you enter in this field is 2 all contracts involving the specified customer will be netted two working days before the settlement date of the contracts If contracts are due for settlement on 5 Mar 08 for example they will be netted two working days before 5 Mar 08 That is on 3 Mar 08 If 4 Mar 08 is a holiday the contracts due for settlement will be netted on 2 Mar 08 oe ORACLE 3 5 1 1 Specifying the Payment Method Netted contracts are settled in Oracle FLEXCUBE by generating a Funds Transfer This is achieved by the interface with the FT module of Oracle FLEXCUBE Broadly there are three types of funds transfers that you can choose from e Outgoing Bank transfers e Outgoing Customer transfers e Internal transfers Outgoing Bank If the beneficiary is a bank you can choose this option You can invoke a list of Outgoing Bank transfer products maintained in the FT module Outgoing Customer If the beneficiary is an individual you should choose an appropriate FT product from a list of FT Products for Individuals that you have maintained in your bank Internal If the benefi
272. ustomer a list of customers or all customers The date for which you generate the report is given For every customer the following information is provided FX Contract Reference Number FX Contract Status Netting Type Netting Status Sold Currency Sold Amount FT Upload Status Corresponding FT Reference Number Bought Currency Bought Amount Corresponding FT Reference Number FT upload status 12 21 ORACLE 12 15 Netting Report by Netting Date and Customer FT to FX This report gives details of Funds Transfers that were triggered by Foreign Exchange contracts The report gives the netting details for a specified customer and date You can generate this report any number of times during the day You can generate this report for e A specific date or a date range e A specified customer a list of customers or all customers The date for which the report is generated is given The details in the report will be under two categories The master part will contain the following information e FT Contract Reference Number e Currency e Amount e Debit or Credit indicator with respect to customer e Value Date e FT upload status e Netting Type The details part of the report will contain the following information e FX Contract Reference number e FX Contract Status e Amount e Debit or Credit indicator debit for Bought and Credit for sold Netting Status of the contract 12 16 Netting report by Maturity Date and Custo
273. uthorize button at the bottom of the screen Before authorizing the records the system validates the following information e User has sufficient rights to authorize the records e Maker ID is not the same as the Authorizer ID After successful validations the system authorizes the records In case an alleged deal having a link reference is submitted for authorization the system updates the CLS deal status to Matched Viewing the Net CLS Currency Positions The CLS Net Position Browser will display the Currency Position for the Pay and Receive accounts Control Accounts of the CLS deals You can invoke the CLS Net Position Browser screen by typing FSSNTPBR in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button CLS Net Position Browser cutoff Date l Cutoff Time Currency L Value Date Alleged Amount Search Advanced Search Reset Export Records per page 15 i 1 of 4 i soto Page CutOff Date Cutoff Time Currency YalueDate PR Matched Amount PR Unmatched Amount PR Settled Amount Alleged Amount P You can search the records based on the following parameters CutOff Date Specify the cut off date for the CLS deal CutOff Time Specify the cut off time for the CLS deal Currency Specify the currency of the CLS deal 8 10 ORACLE 8 1 6 Value Date Specify the date on which the netting was done A
274. valent amount Bought Currency The bought currency in a FX transaction 12 4FX Maturity Analysis Report This report gives details of contracts that are due to mature within a specified period You have to specify the period through the Report Options screen If the report is generated as a part of the Beginning of Day process in addition to contracts maturing within the specified period contracts that are due to mature on that day will be included in the report The report furnishes the equivalent Euro values of amounts in an In currency The locked in exchange rates defined for the Euro against the In currency will be used for currency conversions The report will not furnish the In currency and equivalent Euro values when you close the In currencies and choose the Euro Closed option for the Euro in the Currency Definition screen 12 4 ORACLE From Date Enter the date indicating the beginning of the period for which the report is to be generated The details of contracts maturing between this date and the date given in the next field To Date will be reported The system defaults to today s date To Date Enter the date up to which the report is to be generated The details of contracts maturing between this date and the date given in the previous field From Date will be reported This date should be later than or the same as the From Date specified in the previous fie
275. value date of the contract should be a working day for both the currencies as per the Currency Holiday Calendar and the CLS Bank Holiday Calendar The Exclude From CLS option is not selected for the contract The following validations will be performed for CLS Settlement Instructions The module is FS The product is a specific FX product The currency is a CLS Currency The counterparty is a CLS Participant If the first level check fails the contract will not qualify to be processed as a CLS deal and will be saved as non CLS the CLS Eligible option will remain unchecked The system will process the deal with module as FX 7 2 1 2 Second level check The second level check will be performed only if the first level check is successful Settlement Parties validations for the Sold side of the deal During the check the system will verify the following The Delivery Agent Field 53 is the BIC of the Settlement Member as maintained in the FX Branch Parameters CLS Preferences screen If the participant type of the counterparty is Third Party or if the party is a CLS Participant but not maintained in the CLS Directory then the Intermediary Field 56 is the BIC of the CLS Bank as maintained in the CLS Directory for CLS Participant Type CLS Bank If the counterparty is a Settlement Member then the Receiving Agent Field 57 is the BIC of the CLS bank as maintain
276. ver bought amount The system will recalculate the risk percent based on rollover bought value date and rollover bought amount The system will recalculate the risk weighted amount based new risk percent During revaluation event the system will increase the utilization of pre settlement credit line with revaluation gain When loss is encountered the utilization will be reduced to zero The utilization of the credit line for the revaluation gain will be passed in LCY During reversal of revaluation event system will force decrease the utilization of pre settlement credit line with revaluation gain During contract deletion the system will delete the utilizations of the credit line for the FX contract reference number The utilization of the settlement risk credit line pre settlement risk credit line and weighted risk credit will be deleted During contract reversal the system will delete the utilizations of the credit line for the FX contract reference number The utilization of the settlement risk credit line pre settlement risk credit line and weighted risk credit will be deleted The available amount of non revolving lines will not be modified in case the utilization needs to be decreased during Liquidation Cancellation events 6 2 4 6 Upload Processing FX contract upload functionality will accept or default the values for pre settlement risk tracking settlement risk tracking risk weighted risk tracking and the respective line codes
277. wap Input screen by typing FXDISINP in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button Internal Swap Input Product Category az E Product Category Description Deal Reference Number Buy Sell User Reference Number Buy Currency Sell Currency Buy Interest Rate Sell Interest Rate Buy Amount Sell Amount Spot Deal Exchange Rate Spot Value Date Forward Deal Exchange Rate Forward Value Date a Foreign Exchange Details Contract Reference Number Product Code Bought Currency Bought Amount Sold Currency Sold Amount Value Date lt Money Market Details Contract Reference Number Product Currency Amount Value Date Maturity Date Interest Rate Input By Date Time Authorized By Date Time Contract Status DOC3 Cancel Specify the following details Product Category You need to specify a product category for an internal swap transaction All valid Open and authorized internal swap product categories will be available for selection Deal Reference Number This is a 16 digit system generated reference number that will be used to link all the generated transactions This will be generated using the product category which has been selected This is a display field au ORACLE User Reference No You need to specify a User Reference Number It should not exceed 16 characters The number cannot be modified once it has been authorized Buy Sell Indica
278. will be reported In this case the revaluation is performed on all active contracts but accounting entries are not passed by the system Report Period Enter the date indicating the beginning of the period for which the report is to be generated For the selected currencies and products the revaluation details of all contracts for which revaluation was done between this date and the date given in the next field will be reported The system defaults to today s date To Date Enter the date up to which the report is to be generated For the selected currencies and products the revaluation details of all contracts for which revaluation was done between this date and the date given in the previous field From Date will be reported The system defaults to today s date This date should be later than or the same as the From Date specified in the previous field Click OK button to generate the report Click Exit button if you do not want to generate it a ORACLE 12 12 1 Contents of the FX Straight Line Contract Revaluation Report The report options that you have selected currency counterparty and product are given in the beginning of the report The details of contracts that have been revalued are reported as follows Ref No The Reference number of the contract Buy or Sell Indicates the type of contract FCY Amount For contracts involving local currency the contract amount in foreign currency is display
279. would be a combination of the two products You can define products that are a combination of two other products through the Foreign Exchange Combination Product Maintenance screen Te ORACLE You can invoke the Foreign Exchange Combination Product Maintenance screen by typing FXDPRDCO in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button 4 Foreign Exchange Combination Product Maintenance Product Combination Code Number of Legs 2 Description Start Date End Date Slogan Leg Sequence Linked Product Product Code 1 Single Swap Advice Required Product Code 2 Fields Input By DOCS Date Time Modification Number Authorized Aten Cancel Authorized By Date Time Open You can enter the following details relating to FX Product Combination Definition Product Combination Code In this field you should specify the code by which the product combination is identified in the system If you are defining a new product combination enter a new code in this field You can define a product that is a combination of two different products Description Enter a description for the product Start Date You can create a product such that it can only be used over a particular period The starting date for this period should be specified in this field The system defaults to today s date Enter a date that is the same as or later than today
280. y the deal will not be saved as a CLS deal The system will process it as a normal FX transaction 7 8 ORACLE 7 1 7 Specifying UDF Values You can associate values to all the User Defined fields created and attached to the CLS Bank Holiday Calendar Maintenance screen You can view the list of User Defined fields associated to this screen by clicking Fields button on the CLS Holiday Calendar Maintenance screen User Defined Fields User Defined Fields C Field Name You can enter the value for the UDFs listed here in the Value column For more details on how to create user Defined fields refer chapter Creating custom fields in Oracle FLEXCUBE in the User Defined Fields User Manual under Modularity 7 9 ORACLE 7 1 8 Maintaining the participant type for CLS customers After you identify a customer to be a CLS participant you have to specify the type of relationship the customers financial institutions have with the CLS bank This can be done through the CLS Directory available in the Application Browser You can invoke the Continuous Linked Settlement Bank Directory Maintenance screen by typing FSDBICDI in the field at the top right corner of the Application tool bar and clicking on the adjoining arrow button CLS Bank Directory Maintenance Bank Identification Code Bank Name Continuous Linked Settlements Third Party Ramepan Typa O Settlement M

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