Retail Full Backdating
The retail and commercial systems provide a full range of backdating opportunities. Many of the parameters that define retail full backdating are user-controlled by the effective date, not the posting date of the transaction. A user-defined backdate limit is available within the system. This helps prevent erroneous backdate adjustments due to the entry of an incorrect effective date. The defined retail full backdating parameters impact commitments, loans, participations, and escrow for amounts such as interest owing, interest paid, fees owing, insurance premiums, and late charges. These backdating capabilities improve the data integrity of the backdate adjustments and in turn improve the operating efficiency of the organization.
In many cases, interest and fee rate changes can be effectively backdated over multiple monetary transactions, including other rate changes.
Pricing base changes can be backdated changing the base index from one base to another (LIBOR, Wall Street Journal, or bank prime for example), from fixed rate to variable, or from variable to fixed rate. The history of the index is maintained by each system to provide accurate repricing. Many different automated repricing frequencies and rate relationship combinations are maintained to further maximize the usage of the organization’s resources.
All backdate adjustments are clearly tracked and reported within the retail and commercial systems. User-defined controls determine how long transactions history, including backdate adjustment transactions, are maintained. Yield reporting is available to track the impact of backdate adjustments at the individual loan level up to the portfolio level.