Interest calculation for FD's

[Former Member]

Hi All,

I have created the product type (51A) for FIXED DEPOSITS transaction in money market and done the necessary testing. I have 2 concern related to this product type.

1)   (1)  While creating transaction in TM01 for FD, In case of nominal interest the system is not picking the “Calculation to” date properly. It is eliminating the last date of the transaction. For example I have created the transaction for which the start date is 01/04/2012 and the end term is 30/11/2012. The system taking the interest end date as 29/11/2012 i.e. the system is calculating the interest for 273 days instead of 274 days.

I changed the conditions for nominal interest. I have checked the MONTH END and INCLUDE check boxes for the interest condition.

       (2)  The system is updating only “term start date” (DBLFZ), but not updating the “end of term” (DELFZ) in the table VTBFHA, VTBFHAPO

Please let me know how to resolve these 2 issues.

Regards,

Venkat

[Former Member · Accepted solution]

Hi Venkat,

ad 1)

it is standard design for fixed term deposits that the start of term is considered to be INCLUSIVE  -and the end of term EXCLUSIVE. This means that actually, 30/11/2012 exclusive is considered to be 29/11/2012 included. To have the 30/11/2012 included in the calculation, you might change the end of term to 01/12/2012 - or use the interest rate instrument product type, where you can choose if the start or end of term date is included.

ad 2)

Please see table VTBFHAZU: the DELFZ is saved here per activity RFHAZU (current activity can be read from VTBFHA-RFHAZUNR).

Best regards,

Marie

SAP TRM

[Former Member · Accepted solution]

Hi Marie Wild,

Thanks for your reply...

I am facing the end date issue not only with fixed deposit but also with other product types like rupee term loan,Inter corporate loans etc.. I have given the following inputs while creating the product type.

Product type	Fixed-Term Deposit	Rupee Term Loan
Prod. Category	510 - Fixed-term deposit	550 - Interest rate instrument
Int. Calc. Method	act/365	act/365
Eff. Int. Method	Blank	EU act/365
Calc.Type	Blank	Blank
Facility Category	Blank	Blank
Fee Calculation	Do not include competative bids	Do not include competative bids

Please let me know do i need to do any changes in the configuration.

Regards,

Venkat

[Former Member · Accepted solution]

Hi,

Kindly have the interest calculation method as Act/ActY (ISDA)

Warm regards,

Akhil Poddar

[Former Member · Accepted solution]

Dear Venkat,

as explained before, the last date in the deal (end of term) will always be considered exclusively for a fixed term deposit (51a) - so the last interest period will never include this date. Just take the next day as the end of term: the next day excluded will mean the day before included (e.g. 01.01.2013 exclusive -> 31.12.2012 included as last day in calculation).

For 55a deals, the same is valid: except that you can here decide if the first day is included OR the last day (setting 'Inclusive' , field SINCLE, in the structure tab).

We do not allow for the possibility to set both dates to 'inclusive' -

just imagine a roll-over: which of the days is included in which

interest period in this case?

The interest calculation method is not relevant here (exept that the number of days might vary) - and there is no setting or config to change this standard behaviour.

Best regards,

Marie