TEMENOS T24

Collateral

User Guide

Information in this document is subject to change without notice.

No part of this document may be reproduced or transmitted in any form or by any means,
electronic or mechanical, for any purpose, without the express written permission of TEMENOS Holdings NV.

Copyright 2005 TEMENOS Holdings NV. All rights reserved.

Collateral

Table of Contents
Introduction.............................................................................................................................................. 3
Design ..................................................................................................................................................... 4
COLLATERAL.PARAMETER .......................................................................................................... 4
Processing............................................................................................................................................... 5
ILLUSTRATION................................................................................................................................ 5
COLLATERAL.TYPE........................................................................................................................ 5
CUSTOMER.COLLATERAL.TYPE.................................................................................................. 8
COLLATERAL.CODE....................................................................................................................... 9
COLLATERAL.RIGHT.................................................................................................................... 10
COLLATERAL ................................................................................................................................ 12
Multiple Collateral in MM ................................................................................................................ 18
Partial & Split Collateral use........................................................................................................... 19
Using Portfolios as Security ........................................................................................................... 22
COLLATERAL.ALLOCATION ........................................................................................................ 26
Allocation of Collateral.................................................................................................................... 28
VARIABLE.THIRD.PARTY.PLEDGES........................................................................................... 30
CUSTOMER.PLEDGE ................................................................................................................... 30
CUSTOMER.PLEDGE.GROUP..................................................................................................... 31
ENQUIRIES.................................................................................................................................... 36
REPORTS ...................................................................................................................................... 37
Appendices............................................................................................................................................ 38
Appendix – Installation and Configuration ......................................................................................... 38

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Introduction
COLLATERAL is an optional module (it is not supplied as part of the core T24 system). It can link
into the LIMIT module, and allows the definition and control of collateralised limits.

An item of collateral can vary from a ship to a house or from paintings & sculptures to a single stamp
(or an entire collection). These items will be valued against a market value on a set frequency or ad-
hoc basis.

Items which are contained within T24 itself may be valued automatically, especially in cases such as a
Deposit Account, fixed term Deposit, or all (or part) of a Client portfolio of stocks & shares.

Once the underlying static files are in place the 'Right' or link to items of Collateral is made in
COLLATERAL.RIGHT, here it is decided what the collateral can be used as security for ('linked to').

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Design
COLLATERAL.PARAMETER

The COLLATERAL.PARAMETER file, the id of which is the COMPANY code of your T24 system,
is used to define a few system defaults. The values entered on the record will affect the defaults used
when creating collateral files and the length of time items are held on the system. The help texts on
the few fields required on this record provide all the necessary details required to complete the input.
An example record is shown below:

Figure 1 Collateral Parameter file.

Note that the DEFAULT.ADDRESS field relates to whether you want to record details from the
CUSTOMER file for certain COLLATERAL.TYPE records. So you may need to amend this record
again later.

There is a useful option set by the field called COLLATERAL.LINK. This takes the user to the
appropriate COLLATERAL record straight after they have successfully validated the
COLLATERAL.RIGHT record it relates to. Whilst this is very useful for getting the key correct and
aiding input it should be noted that the records still require authorisation in the correct order
(COLLATERAL.RIGHT before related COLLATERAL records).

This record can also be used to specify a Margin for the Currency conversion risk in respect of
Collaterals when the Collateral Currency is different from the Limit Currency.

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Processing
ILLUSTRATION

LIMIT 50003.0000100.01 is in Currency USD. The COLLATERAL.RIGHT for this Customer is

50003.1 CURRENCY of the COLLATERAL 50003.1.1 is GBP and a LD deposit of GBP 100,000 is
linked to the Collateral. If FX.RISK.MARGIN for COLLATERAL.CCY GBP is specified as 95, then the
SECURED.AMT under COLLAT.RIGHT in the Limit record 50003.100.01 will be updated with USD
147,962.50 (That is 100,000 x 1.5575 x 95/100 assuming the MID.REVAL.RATE for GBP to USD is
1.5575 and the EXECTUION.VALUE is F in the COLLATERAL.TYPE).

COLLATERAL.TYPE

This file is used to define classes (or types) of COLLATERAL such as cash, buildings, guarantees
and stocks (or sub-divisions thereof). The information on this file is used to determine, for each type,
how the COLLATERAL value is established, re-valued and linked to other applications.

For example the general classes could be:

Id Type Description
100 CASH All types of Cash. Accounts, MM & LD deposit contracts.

200 HOUSE All forms of property, from domestic to industrial properties.

300 ART Could cover paintings, sculpture, jewellery etc.

400 SHARES The value of a client's shares.

The key to this record is numeric and is entered in the COLLATERAL.CODE records. It is worth a
short note here explaining the IDs used and how you can configure a logical key structure.

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Lets assume we have the following records:

File Key Details
CUSTOMER 50003 Glaxo Wellcome INC Customer record

COLLATERAL.TYPE 100 Cash Collateral - Class of cash or equivalents

COLLATERAL.CODE 101 MM Deposits - Specifically MM deposits, links to 100

COLLATERAL.TYPE record.
102 LD Deposits - Specifically LD deposits, links to 100
COLLATERAL.TYPE record.
103 Savings Accounts - Specific to Accounts, links to
100 COLLATERAL.TYPE record.

COLLATERAL.RIGHT 50003.1 The first linking of collateral for 50003

50003.2 The second link for 50003

COLLATERAL 50003.1.1 COLLATERAL item 1 linked to 50003.1

COLLATERAL.RIGHT
50003.1.2 COLLATERAL item 2 linked to 50003.1
COLLATERAL.RIGHT
50003.2.1 COLLATERAL item 1 linked to 50003.2
COLLATERAL.RIGHT

The screenshot below shows the settings for a COLLATERAL.TYPE, which covers
LD.LOANS.AND.DEPOSITS, MM.MONEY.MARKET, ACCOUNT and BILLS.

Figure 2 Collateral Type Record.

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Note how the APPLICATION field is multi-valued to allow the differing types to be accepted under this
class of collateral. It should be noted that the valuation method should be valid for the types entered.
Here T24 will provide the value for the contracts and Accounts.

A short note on value types:

• Nominal - Nominal Market value.

• Execution - Percentage of Nominal value if required or value of underlying MM, LD contract
etc.
• Third Party - How much is used outside of T24.
• Gen Ledger - The amount we record for General Ledger purposes.
• Central Bank - Any specific limitation on values set by the Central Bank.

The next Screenshot will show a COLLATERAL.TYPE, which requires the user to enter the values
for the collateral.

Figure 3 Collateral Type record requiring the user to enter the value for the collateral.

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Using a structured record set-up may assist in entering and understanding the links between the
COLLATERAL.TYPE and COLLATERAL.CODE records.

Collateral Type Description Collateral Code Description

100 Cash 101 MM Deposits
102 LD Deposits
103 Savings Accounts
200 Houses 201 Business Property
202 Domestic Property

CUSTOMER.COLLATERAL.TYPE
This file is used whenever the Collateral execution value (if defined as a % of Nominal Value in
Collateral Type) should be different for specific Customers.

For a record to be entered in this file the Execution value in the main COLLATERAL.TYPE record
should have been defined in the format %N. The ID of the records in this file would be a Customer ID
followed by a Collateral Type ID separated by a hyphen.

ILLUSTRATION

COLLATERAL.TYPE ID: 100

NOMINAL.VALUE: F
EXECUTION.VALUE: 100%N.

For example when a LD deposit of USD 100,000 is attached to a Collateral belonging to this type then
the nominal value will default to USD 100,000 and the execution value will be also USD 100,000,
which is 100%N.

If for customer 50003 the execution value desired is 75%N, then a record with ID 50003-100 could be
created in CUSTOMER.COLLATERAL.TYPE and EXECUTION.VALUE would be defined as
75%N. For the same Collateral defined above, the execution value for the Customer 50003 will be
calculated as USD 75,000 (75% of Nominal Value).

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Figure 4 CUSTOMER.COLLATERAL.TYPE.

COLLATERAL.CODE

Once the values in COLLATERAL.TYPE have been input, the COLLATERAL.CODE records may
be entered. The COLLATERAL.CODE file permits definition of the allowable collateral (object)
types, which may occur under each category of right and permits the definition of a default frequency
of review of these rights.

This collateral code is also used in determining how collateral values are reallocated across central
bank reporting lines.

Figure 5 A COLLATERAL.CODE record.

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COLLATERAL.RIGHT

The COLLATERAL.RIGHT file is used to record the status of a right of security and to indicate
against which customer out standings the right applies.

The link between the COLLATERAL.RIGHT and the COLLATERAL object itself is implicit in the
item-id structure between the two files.
Collateral can be allocated to limits at any product level if PERCENT.ALLOC is populated; in this case
the percentage of the execution value of the COLLATERAL defined will be directly allocated to the limit
defined in LIMIT.REFERENCE.
If PERCENT.ALLOC is not defined then the execution value of the defined collateral will be allocated
in order of entry, to the limit at the top of the limit structure of the limit defined in LIMIT.REFERENCE.
The amount allocated will be for the value of the ONLINE.LIMIT until the execution value of the
collateral is exhausted.

Limit level

The COLLATERAL is valid against all contracts currently recorded under a particular limit reference
and against any contracts, which subsequently come under that LIMIT.
Note the item can be spilt across several LIMIT s or contracts by percentage.

Figure 6 Collateral can be split across several Limits of contracts by percentage.

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Customer level

The COLLATERAL is valid against any debit balance, which exists or arises on the customer's
accounts or contracts with the bank.

It is important to note that though the default name of the field is LIMIT.REFERENCE the actual
content may be either:

• An ACCOUNT
• A FOREX contract
• A MM.MONEY.MARKET contract
• A MG.MORTGAGE contract
• An MD.DEAL contract (Guarantee)
• A valid LETTER.OF.CREDIT
• Or the entire CUSTOMER outstandings if this is left blank.

The following screenshot shows that security from David Brown Ltd is being used as cover for the loan
to Glaxo Wellcome Foundation.

Figure 7 Security from one company can be used as cover for a loan for another.

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COLLATERAL

The item of collateral itself is defined on the COLLATERAL file, which contains details of the values,
review frequency, value date and expiry of the collateral.

It is also possible to define a partial use of an item, a fixed amount of the available collateral and even
on the contract itself a maximum usage of that collateral. At present this is restricted to Money market
deposits.

There is the option to enter an EXPIRY.DATE on both the COLLATERAL item itself and the
controlling COLLATERAL.RIGHT. An item of COLLATERAL will be marked as liquidated on the
earlier of these two dates. Once the COLLATERAL expiry is reached the value is no longer useable
by the system, whereas when the COLLATERAL.RIGHT expiry is reached the right to all collateral
linked to it becomes invalid.

Note the expiry of the item of collateral (such as the deposit contract maturity) is not defaulted
automatically to the EXPIRY.DATE field. This is because the underlying contract can of course be
extended at anytime.

These concepts can be difficult to explain and grasp, so let's have a look at some uses of these
options.

Physical Collateral - A Painting

This is a very simple example and will show the COLLATERAL record defining the valuation and
how it is linked to COLLATERAL.RIGHT where it is used to provide partial security for a loan
granted by the bank.

A COLLATERAL.TYPE of 800 defines a class of security of ART.

Figure 8 Physical Collateral – e.g. a painting.

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First we enter the COLLATERAL.RIGHT, which details the item security is required for.

Figure 9 A COLLATERAL.RIGHT.

At this stage we do not have any amount of security we are just establishing what types of collateral
are to be used for security. Next we need to enter the actual COLLATERAL record to link in the
actual item (in our example it's a Painting held as security in the banks vault).

If settings in COLLATERAL.PARAMETER are defined we are automatically taken to the input

screen of COLLATERAL.

Note the values entered are shown for illustration purposes. The bank can of course decide that it will
not accept the full current market valuation, as the price, if the bank had to redeem the security, could
vary a great deal. It has also been shown that a third party has a right to $10,000 of any sale proceeds,
and that the Central Bank recommends a figure of 33% of the market value for central bank reporting
purposes.

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Automatically Valued Security - Deposit Account

Here the client is extended credit via the LIMIT system and the credit balance on his account is split
between 2 Limits (a FX limit and a LD limit). So first we need the COLLATERAL.TYPE record that
defines the valuation conditions for LD.

Figure 10 Automatically Valued Security – Deposit Account.

Now we can enter the COLLATERAL.RIGHT to split between the 2 Limit types:

Figure 11 Collateral Right split between 2 Limit types.

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We have set it up so that 60% of the available cover is allocated to a LIMIT covering LD . The other
40% is used towards the clients FX LIMIT.

Note that as we need to enter the id of each of the LIMIT records and these records need to be
established in the first place.

So now we need to attach the LD current account to the COLLATERAL.RIGHT record by defining
the COLLATERAL record in the screenshot below:

Figure 12 Attach current account to the Collateral Right by defining Collateral record.

When the ACCOUNT number is entered the system retrieves the available balance and populates
the values fields as required.

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So the current balance of the Account is USD 25,000.00 and according to what we have set we
require 60% of that to be allocated against the LIMIT 50003.00002000.01.

• 60% of USD 25,000.00 equates to USD 15,000.00

Now we can check the LIMIT record to see if it has been updated.

Figure 13 Check the Limit record has been updated.

We can tell that it has been successful as the amount of security is shown. There is more than enough
cover to allow the full overdraft of USD 100,000.00 to be permitted.

There is a more detailed description on how COLLATERAL can assist the LIMIT module in
providing variable Limits later in this guide.

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Online Update of Cash Collateral

Online update field in COLLATERAL.TYPE controls online update of cash collateral along with the
online update field in the limit record. If cash collateral such as AC, LD, MM, SC, FD, MD, LCE & LCI
are attached to a limit record; any change in these collateral value are updated during the Close of
Business process.
If such collateral’s values are to be updated online then this field is to be marked as "Y". (Limit record
where the cash collateral are attached is also to be marked "Y" in the online update field) In such
cases the collateral is recalculated when the limit reference is drawn. If the field is marked "N" or left
blank, then no online update is done.

Figure 14 For Online update, set field to “Y”.

The ONLINE.UPDATE field in COLLATERAL.PARAMETER must also must be marked "Y" for
online update process.

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Multiple Collateral in MM

If a MM deposit is to be used as collateral, it can be spread over a number of COLLATERAL records.

However, it is not possible to allow the combined amounts to exceed the money market balance, or if
it has a value in the MAX.LEGAL.BAL field then it cannot exceed that. A percentage amount can be
entered in the MAXIMUM.AMOUNT field on the COLLATERAL record, this will then set the field to be
that percentage of the money market balance (or MAX.LEGAL.BAL if set).

A Maximum level of Cover allowed

The bank sets a maximum level that it wishes to keep the collateral from exceeding. This is to ensure
the bank is not using collateral, which it has no right to be able to use. Here we use the field on
MM.MONEY.MARKET called MAX.LEGAL.BAL.

As an example, if the legal paperwork allows the bank to claim USD 4.5million of a fixed term deposit,
but after increase and capitalisation the contract is currently USD 5.2 million it would not be correct to
use the full amount as security.

Figure 15 Set maximum level of cover allowed.

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Partial & Split Collateral use

This can be used by a client who has a large MM deposit contract and wishes to use it as security for
several different facilities up to a maximum value. Any thing over that, they want to be able to draw
against at any time.

To be able to achieve this we will enter multiple COLLATERAL items and the associated
COLLATERAL.RIGHT records.

By partial it is meant that not all of the MM deposit is used for security at once, even if it is available.

By splitting, the MM deposit can be used across different COLLATERAL.RIGHT records for various
cover requirements.

With this in mind we will:

• Set the maximum use of the deposit to USD 5million.

• Use part of the collateral USD 3million – to cover a Loan.
• Use a further USD 1million of the collateral to cover an Overdraft facility.
• Leave some unallocated.

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Split Collateral

We can enter the COLLATERAL.TYPE, COLLATERAL.CODE and COLLATERAL.RIGHT

records as we have done before in the earlier examples.
Here we shall concentrate on the different uses made within the COLLATERAL record(s):

Figure 16 Split Collateral.

If this was the sole usage of the MM deposit then there remains a USD 2,000,000 unused security.

Let's now use another USD 1,000,000 and create a second COLLATERAL record using the same
MM deal.

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Figure 17 Create a second Collateral record using same MM Deal.

Note the id’s of these records are based on two COLLATERAL.RIGHT records; one covers the
Loan contract whilst the second covers an overdraft facility.

T24 will not let you exceed the total of the contract either in one usage or across several records.

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Using Portfolios as Security

In this third example the collateral we have defined is loosely described as Shares. We can arrange to
take a complete Portfolio or to restrict it down to an individual security holding, within a portfolio.

This is achieved by entering the key in APPLICATION.ID to select the entire Portfolio or part thereof.
We also have the option to filter the collateral to a specific ASSET.TYPE or SUB.ASSET.TYPE; this
is set on the relevant COLLATERAL.TYPE record.

An override message is generated if an attempt is made to sell all or any part of the security holding
being used as collateral. Collateral checking of individual security holdings is performed in the
following applications SEC.TRADE, SEC.OPEN.ORDER, SECURITY.TRANSFER,
POSITION.TRANSFER, REDEMPTION.CUS and ENTITLEMENT.

However it is important to note that the value of the security holding is not taken into consideration
when the override is generated, only that it is being used as collateral.

We have issued a Guarantee on behalf of a client using an MD Contract and wish to link the shares of
that client as security.
Here we have the COLLATERAL.RIGHT set-up in the following Screenshot:

Figure 18 Set Collateral Right.

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Now the COLLATERAL itself:

Figure 19 Set-up Collateral.

Let's check that amount with an ENQUIRY SC.VAL.COST on the clients Portfolio:

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Figure 20 Check the amount by running an Enquiry on the client’s Portfolio.

So the client has:

TOTAL Financial Assets GBP 61,372.92

Total Domestic Shares GBP 67,780.48

Total GBP 129,153.40

This matches the amount shown earlier on the COLLATERAL record.

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Limits Variable

Limits can be created that vary with the amount of the collateral held, i.e. where an unsecured amount
can be topped up with an amount that can decrease/increase in line with the amount of collateral held.
For example:

Unsecured Limit USD 5,000.00

Secured Limit USD 15,000.00
Max Limit USD 30,000.00

When the value of the collateral is at least USD 20,000.00 the full limit can be used, whereas if the
collateral valuation falls to USD 2,500.00 then the limit would automatically be restricted to USD
7,500.00.

Figure 21 Limits can be created that vary with the amount of the collateral held.

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Here the collateral has a value of USD 25,000.00 so we add the unsecured amount (USD 5,000.00)
giving a total available Limit of USD 30,000.00.

Fixed

Where the amount of the COLLATERAL is stable, or the bank has pledged a fixed amount that the
COLLATERAL will be accepted for, a ‘fixed’ type LIMIT may be used. This will effectively maintain
the value of the LIMIT at a pre-agreed level, which will not be automatically reduced/re-instated
according to the value of the COLLATERAL item(s). In effect this is the same as the variable, except
the Limit amount stays fixed and the user controls the Limit manually.

The LIMIT module is part of the core system but the use of collateralised limits is only available if the
COLLATERAL module is purchased.

COLLATERAL.ALLOCATION

When creating general ledger lines in RE.STAT.REP.LINE, it is possible to distinguish out standings
by the CRF key etc. However, to report out standings, say for secured and unsecured loans, by
collateral held you must use COLLATERAL.ALLOCATION to re-allocate the out standings.
Typically, you would allow all the Loans to be reported to the unsecured line and this utility will
produce a report detailing the adjustments required for each line to be reported. The adjustments do
not amend the ledger or the source lines but produce a report of the changes you need to make when
producing external reports, for example to Central Banks.

RE.STAT.REP.LINE no. Description Out standings

GLSTD.100 Loans secured - property
GLSTD.150 Loans secured - shares
GLSTD.200 Loans unsecured USD 1,000,000.00

After running the utility the values would appear as shown below.

RE.STAT.REP.LINE no. Description Change Required

GLSTD.100 Loans secured - property + USD 100,000.00
GLSTD.150 Loans secured - shares + USD 150,000.00
GLSTD.200 Loans unsecured - USD 250,000.00

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So, as shown below, the general ledger amount for Loans unsecured (GLSTD.200) would be:

Value from Ledger USD 1,000,000.00

Adjustment required USD - 250,000.00
Manually reported USD 750,000.00

The example screens below show the COLLATERAL.ALLOCATION input screen and a sample
report.

Figure 22 Collateral Allocation input screen.

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Figure 23 Collateral Allocation sample report.

Allocation of Collateral

A limit may have more than one source of collateral. That is, the limit number may occur on more than
one COLLATERAL.RIGHT record. Each of these collateral rights may refer to more than one limit
and so on. T24 recognises this situation and if it fails to find enough collateral to cover a limit it will try
to reallocate the distribution of collateral across other permitted limits to free some collateral to
eliminate the shortfall.
You may thus see collateral allocation to a particular limit change because of the collateral
requirement of a limit, which shares access to the collateral indirectly. This prevents some LIMIT’S
blocking access to effectively usable collateral.

This facility is useful where complex connections of collateral and limits are in operation. Fairly simple
arrangements will usually be sufficient.

Manual Collateral Allocation Priority.

The system will calculate the allocation sequence to try to reduce any shortfall as much as possible.

If you want to be able override the system’s sequence manually then set the field ORDER.PRIORITY
in LIMIT.CHANGE to “MANUAL”. This will then set the ORDER.PRIORITY field in
COLLATERAL.PARAMETER to “MANUAL” at the next close of business.

A record of how the

system has allocated collateral to limits is kept in the file
LIMIT.COL.ALLOC.WORK. If the COLLATERAL.PARAMETER field ORDER.PRIORITY is

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“MANUAL” then the priority of each collateral right within a limit can be set in the corresponding
MAI.ALOC.PTY field. The collateral re-allocation will take place when the record is authorised.

To find the limit or collateral right for which you want to set the priority, search
LIMIT.COL.ALLOC.WORK field LIMIT.ID.

Unsecured portion of a variable LIMIT

You may consider the unsecured portion of a limit should only come into operation when there is not
enough collateral available. On the other hand you may want to allow the unsecured portion to be
used without collateral cover and only after that is exceeded then allocate collateral. This does not
affect the total of usable limit, only the amount of collateral allocated if less than the maximum is used.

This is controlled by the use of field COVER.UNSEC.1ST in COLLATERAL.PARAMETER.

Illustration

With COVER.UNSEC.1ST not set

Collateral available USD 90,000
Maximum unsecured USD 30,000
Maximum total USD 100.000
Secured Amt USD 90,000 (+10,000 unsecured)

With COVER.UNSEC.1ST set to “Y”

Collateral available USD 90,000
Maximum unsecured USD 30,000
Maximum total USD 100.000
Secured Amt USD 70,000 (+30,000 unsecured)

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VARIABLE.THIRD.PARTY.PLEDGES
Functionality is available which enables the user to cover the liabilities of a group of customers, with
the pledge offered by one or more customers. Customers may generally pledge their assets (held in
their portfolio) in favour of other customers. Each pledge has different priorities and the amount
allocated to each customer is calculated dynamically rather than based on fixed percentages.

The system will allocate the pledged assets of the main customers to the recipient customers, based
on total liabilities of the recipients, in the sequence of the priorities allocated, and produce a report
during Close of Business Batch run.

CUSTOMER.PLEDGE

Figure 24 CUSTOMER.PLEDGE.

The ID of this record is a valid customer number, who is offering his assets as pledge for allocation.
This table contains the details of the recipient customers, the priority of allocation and the maximum
pledge amount. There is also a provision to specify whether internal pledges are allowed.

The priorities cannot be duplicated for different customers. For example: if customer 100113 gives
priority 1 to customer 100114 then the customer 100113 cannot give priority 1 to any other customer.
Similarly, customer 100114 cannot get the same priority from any other customer.

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CUSTOMER.PLEDGE.GROUP

Figure 25 CUSTOMER.PLEDGE.GROUP.

Based on the CUSTOMER.PLEDGE record the CUSTOMER.PLEDGE.GROUP record is

generated by the system online. This record shows the Main customer who is offering pledge and the
recipient customers and the priority allocated by the main customer to the recipient customer. The
updating is done as per implied pledge concept.

The various assets and liabilities of the individual customers involved in CUSTOMER.PLEDGE are
processed during Close of Business batch run and a report is generated showing the allocation of
pledge between different customers.
At the time of allocation, suppose a main customer in CUSTOMER.PLEDGE is also having liability,
his liability will be covered first with his assets and only the balance amount, if available it is allocated
to the different customers shown in the record CUSTOMER.PLEDGE.GROUP in the order of
priority. This procedure is followed for all the customers attached to the main customer in
CUSTOMER.PLEDGE. This allocation is shown in the file CUST.COLLATERAL.ALLOCATION,
generated during Close of Business batch run.

The Assets and liabilities of various customers are processed during the Close of Business and the
SC.POS.ASSET record is generated.

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Figure 26 SC.POS.ASSET record.

The individual records are shown below:

Figure 27 SC.POS.ASSET Individual records.

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Figure 28 SC.POS.ASSET Individual records.

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Figure 29 SC.POS.ASSET Individual records.

Details of SC.POS.ASSET

From the above examples the ID Customer 50043 has the following assets:

Credit balance in account 20087 10,000,000

LD Deposit LD0415500012 1,000,000
LD Deposit LD0415500013 2,000,000
LD Loan LD0415500014 25,000 (-)
Net position 12,975,000

Based on the above information, the CUST.COLLATERAL.ALLOCATION is generated in the

screenshot as follows:

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Figure 30 CUST.COLLATERAL.ALLOCATION. record.

The total liabilities for the ID Customer 50043 are – 25000.

The total Assets Market Value for the ID customer 50043 is 13,000,000
The total Assets Market Value for this customer is (13,000,000 – 25,000) = 12,975,000

Out of this an allocation of 100,000 was done for the customer 50029.

The total of allocation of allocation is 100,000 (This is updated in MKT.VAL.ASSETS)

The difference between the two, i.e. the free amount (12,975,000 – 100,000) = 12,875,000 is updated
in the field MKT.VAL.FREE.AMT

This process is repeated whenever there is a change in the assets and liabilities of the group, during
the Close of Business.

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Collateral

ENQUIRIES

Although there are three ENQUIRY records, they are normally accessed through the first ENQUIRY
CO.001. This requires the input of selection criteria based on a CUSTOMER code.

Figure 31 Enquiry record CO.001.

Drilling down for more information invokes the next ENQUIRY CO.010.

Figure 32 Enquiry record CO.010.

When drilling down for more information the last ENQUIRY CO.100 is invoked.

Figure 33 Enquiry record CO.100.

Further drilling down for more information will take the user to the actual COLLATERAL record
concerned.

TEMENOS T24 User Guide Page 36 of 38

Collateral

REPORTS

The following reports are available for COLLATERAL:

Report Id (REPGEN.CREATE) Description

CO.COVER Percentage of cover held by
COLLATERAL.RIGHT
CO.EXPIRED Items past expiry date
CO.EXPIRY Items approaching expiry dates
CO.INVENTORY Inventory by COLLATERAL.TYPE
CO.REALLOC Adjustments for General Ledger
CO.REVIEW Review dates for COLLATERAL items
CO.RGT.EXPIRED Expired COLLATERAL.RIGHT
CO.RIGHT.EXPIRY COLLATERAL.RIGHT nearing expiry date
CO.RIGHT.REVIEW COLLATERAL.RIGHT nearing review date

TEMENOS T24 User Guide Page 37 of 38

Collateral

Appendices

Appendix – Installation and Configuration

Collateral items can be linked directly to:

A valid LIMIT

Or

• An ACCOUNT
• An FOREX contract
• An LD.LOANS.AND.DEPOSITS contract
• An MM.MONEY.MARKET contract
• An MG.MORTGAGE contract
• An MD.DEAL contract (Guarantee)
• A valid LETTER.OF.CREDIT
• Or all the CUSTOMER outstandings

The LIMIT may be variable depending on the amount of collateral held or fixed. If fixed, the collateral
is for information and reporting purposes.
Only after the COLLATERAL.RIGHT records are in place can items of COLLATERAL be recorded.

TEMENOS T24 User Guide Page 38 of 38